Welcome to UK Credit Insurance
Credit Insurance provides the essential commercial protection that allows many businesses to trade by protecting against the potentially disastrous effects that can occur as a result of bad debts. Credit Insurance cover helps to ensure that a business maintains a solid financial footing even in turbulent economic conditions or in uncertain export markets.
Usually referred to as credit insurance, bad debt insurance, or even export credit insurance, cover falls broadly within two risk categories;
- Commercial Risk Insurance: Covers non payment of debts due to Insolvency (Administrative receivership, Bankruptcy, Liquidation) or Protracted Default (failure to pay for goods or services provided in accordance with a contract).
- Political Risk Insurance: Included on policies with an export component to cover situations where the actions of government cause the payment failure. Examples include; Public buyer default, Export restrictions, Import restrictions, Political events, Foreign currency shortages or restrictions, Inconvertibility, Contract termination, Contract frustration.
Whilst the responsibility for collecting payments and receivables due from buyers and other commercial partners will always sit with the client business, it is a big risk for many companies. Credit Insurance cover for a business can protect against the impacts of:
- trading partner insolvency
- cash flow tightening
- liquidity issues
- protracted non-payment situations
- project stage payment delays
- slow payment procedures
Trade Credit Insurance is intended for businesses that are mostly contracting organisations like construction or export companies. It protects their receivables in case the buyer defaults from their payment obligations due to bankruptcy, insolvency and other circumstances. It is usually offered as a portfolio, covering a list of buyers and firms with due payments, but may also cover only one buyer or only one component of a project.
Many different trade credit insurance policy variations are available:
Trade credit insurance top-up scheme
Eligible businesses can purchase additional 'top-up' credit insurance cover under the government's Trade Credit Insurance Top-up scheme (TCITS). The scheme is a short-term measure to provide real help to businesses, in the current economic climate, whose credit insurance cover has been reduced by their provider.
The scheme was updated in August 2009 and the premium for purchases of 'top-up' cover under the scheme has been reduced to 1 per cent of the value of the cover. The following changes were also made:
- The minimum threshold of £20,000 for purchases of 'top-up' cover has been removed.
- The upper limit has been raised to £2 million.
- Eligibility for the scheme is backdated to include those companies who had their credit limits reduced on or after 1 October 2008.
- Up to 28 days' retrospective cover can be purchased in circumstances where a business requires continuity of cover from a partial reduction made by insurers in the previous 28 days.
The TCITS is open to eligible businesses trading in the UK, with a trade credit insurance whole-turnover policy. If a business’ credit limit is reduced then they can purchase top-up cover via their existing credit insurance provider, who will administer the scheme on the government's behalf.
To request an indicative quotation on any credit insurance cover or more information please complete the outline credit insurance quote request form.
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Credit Insurance Underwriters 
