Introduction to Trade Credit Insurance

Course Introduction

This introductory half day course covers the key aspects of Trade Credit Insurance providing an understanding of the topic and its practical applications, particularly in the context of high-risk merchants and efficient monitoring and claims processes.

Course Objectives

1. Understand Trade Credit Insurance: Learn the fundamentals of trade credit insurance and its role in merchant risk management.
2. Identify Coverage Specifics for High-Risk Merchants: Explore insurance options that cater to the unique needs of high-risk merchants in the payments sector.
3. Implement Effective Monitoring and Claims Processes: Understand the application of trade credit insurance in automating credit and fraud monitoring.

Course Content

• • Introduction to Trade Credit Insurance
  • • What is Trade Credit Insurance?
      • Definition and purpose
      • Bad debt insurance overview
    • Importance of Trade Credit Insurance
      • Mitigating risks of non-payment
      • Financial impact of bad debts on organisations

   

  • Risks Covered by Trade Credit Insurance
  • • Commercial Risks
      • Definition and examples
      • Insolvency and payment defaults
      • Application in domestic and export business
    • Political Risks
      • Definition and examples
      • Risks associated with country-related political or economic events
      • Specific scenarios like exchange transfer delay, government actions, war, and public buyer defaults

   

  • Structure and Benefits of Trade Credit Policies
  • • Trade Credit Policy Structure
      • Overview of policy structure and key components
    • Financial Benefits
      • Role of trade credit insurance in securing financing
      • Relationship with banks and financial institutions
    • Business Development and Marketing
      • Utilising trade credit insurance as a tool for market expansion
      • Impact on buyer terms and capital utilisation
    • Credit Management
      • Processes for investigating and monitoring buyers
      • Benefits like early warning of financial difficulties and legal cost coverage

   

  • Specialist Policy Structures and Coverage Variations
  • • Whole Turnover Cover and Variations
      • Different cover options: Selected Markets, Named Buyers Only, etc.
    • Specialist Policies
      • Specific Account / Key Account
      • Buyer Credit / Supply Chain Financing
      • Securitisation, Captive Reinsurance, Non-delivery Cover, Vendor Credit, and more
    • Advanced Coverage Options
      • Cover for unfair calling of guarantees, consignment stocks, goods at fairs, royalties, leasing, tenant’s default, and top-up cover

   

  • Claims Process and Management
  • • Pre-Claims Management
      • Risk management and loss mitigation strategies
      • Maintaining cover and client relationships
    • Making and Examining Claims
      • Claims submission process
      • Reasons for claim denials and how to avoid them
      • Handling small losses and claims, calculating quantum
    • Post Claim Recovery Actions
      • Debt collection, debt rescheduling
      • Allocation of recovery and political risks claims