Trade Credit Insurance
Trade Credit Insurance Information
Trade credit insurance is a business insurance product that indemnifies a seller against loses from non-payment of a commercial trade debt. With trade credit insurance in place, the seller/policyholder can be assured that non-disputed accounts receivable will be paid, either by the debtor or the trade credit insurer within the terms and conditions of their policy.
TCI is a financial tool which manages both commercial and political risks that are beyond a company's control. Balance sheet strength is ensured, cash flows are protected, and loan servicing, costs, and asset valuation are enhanced. A trade credit insurance policy also allows companies to feel secure in extending more credit to current customers, or to pursue new, larger customers that would have otherwise seemed too risky. It reduces the risk of entering new markets.
Source 1-Euler Hermes