What is Trade Credit Insurance?

Trade Credit Insurance, also known as Accounts Receivable Insurance, provides coverage against the risk of non-payment by your customers. This type of insurance protects your business from losses due to customer insolvency, protracted default, or other unforeseen circumstances that prevent your customers from paying their invoices. Trade Credit Insurance allows you to extend credit with confidence, knowing that your cash flow is protected.

Why Do You Need Trade Credit Insurance?

In Australia, businesses of all sizes and industries are vulnerable to the risks associated with extending credit to customers. A single bad debt can have a significant impact on your cash flow and profitability, and the insolvency of a major customer could threaten the survival of your business. Trade Credit Insurance helps mitigate these risks by providing financial protection against non-payment, allowing you to focus on growing your business without worrying about potential losses.

Key reasons to consider Trade Credit Insurance include:

  • Protection Against Non-Payment

    Covers losses resulting from customer insolvency, protracted default, or political risks, ensuring that your business is compensated if a customer fails to pay.

  • Enhanced Cash Flow Stability

    Helps maintain a stable cash flow by protecting your accounts receivable, reducing the risk of financial shortfalls due to unpaid invoices.

  • Increased Sales Confidence

    Allows you to extend credit to new and existing customers with confidence, knowing that your business is protected against the risk of non-payment.

  • Improved Access to Financing

    Demonstrates to lenders that your receivables are insured, which can improve your access to financing and potentially lower your borrowing costs.

  • Stronger Customer Relationships

    Enables you to offer more flexible credit terms to customers, helping you build stronger relationships and increase sales.

Who Should Consider Trade Credit Insurance?

Trade Credit Insurance is essential for any business that extends credit to customers, including:

  • Manufacturers and Wholesalers: Protects against non-payment for goods delivered to customers, ensuring that your cash flow remains stable.
  • Exporters: Provides coverage for international transactions, protecting against non-payment due to political risks, currency issues, and customer insolvency.
  • Service Providers: Safeguards against non-payment for services rendered, helping you maintain a healthy cash flow and avoid financial strain.
  • Construction Companies: Protects against non-payment for completed projects, reducing the risk of financial loss due to customer default or insolvency.
  • Retailers and Distributors: Ensures that your business is protected against non-payment from key customers, helping you avoid significant financial losses.

What Does Trade Credit Insurance Cover?

A typical Trade Credit Insurance policy in Australia covers:

  • Customer Insolvency: Provides coverage if a customer is unable to pay due to insolvency, bankruptcy, or liquidation.
  • Protracted Default: Covers losses if a customer fails to pay within an agreed-upon period, even if they are not insolvent.
  • Political Risks: Protects against losses resulting from political events, such as war, expropriation, or currency inconvertibility, that prevent international customers from paying.
  • Pre-Shipment Risks: Optional coverage for costs incurred before goods are shipped, such as raw materials and manufacturing expenses, if a customer cancels an order or becomes insolvent.
  • Collection Costs: Covers the costs of pursuing unpaid debts, including legal fees and debt collection services, ensuring that you can recover outstanding amounts.

zoka insurance

Trade Credit Needs:

Tailored Coverage

We understand that every business has unique credit risks. Our team works closely with you to customize a Trade Credit Insurance policy that fits your specific needs and industry requirements.

Competitive Pricing

Our strong relationships with leading insurers allow us to negotiate competitive rates, ensuring you receive comprehensive coverage at an affordable price.

Expert Guidance

With years of experience in the insurance and financial industries, our brokers provide clear, professional advice, helping you make informed decisions about your credit protection.

Comprehensive Support

From obtaining the right coverage to managing claims, Zoka Insurance Brokers provides end-to-end support, ensuring your business is always protected against credit risks.

Peace of Mind

By choosing Zoka Insurance Brokers, you can focus on growing your business, knowing that your cash flow and receivables are safeguarded against a wide range of risks.

The Zoka Insurance Brokers Advantage

When you partner with Zoka Insurance Brokers, you’re choosing more than just an insurance provider you’re choosing a trusted ally committed to protecting your business’s financial health. Our deep understanding of trade credit risks, combined with our personalized approach to service, ensures that your business is protected with the best coverage available. With Zoka Insurance Brokers, you can confidently extend credit, knowing that your business is protected against the unexpected.

Get a Quote from Zoka Insurance Brokers Today

Don’t leave your business vulnerable to the risks of non-payment. Contact Zoka Insurance Brokers today to get a personalized quote for Trade Credit Insurance tailored to your needs. With Zoka Insurance Brokers, you can protect your business, secure your cash flow, and grow with confidence.

Get a Quote