Protect your business with Debt Protect
Trade credit insurance for SMEs
Businesses that offer their customers credit terms are vulnerable to the risk of non-payment. If your customer does not pay their invoice on time or loses the ability to pay you, those outstanding receivables become a bad debt which in turn becomes your loss. Debt Protect is Aon’s exclusive trade credit insurance policy that can protect you against the risk of such losses and will support your business continuation.
A bad debt will not only wipe away profits, it impacts cash flow, weakens the balance sheet and takes your time away from the daily running of the business. You may think that as a small business your risk of bad debt losses are low or that getting such a product could be costly, but a trade credit insurance or bad debt insurance policy tailored to suit risks commonly faced by businesses with smaller revenues could provide a cost-effective option to protect your business against bad debts.
Debt Protect can be a simple and low-cost credit insurance solution to suit businesses that have an annual turnover of between $5M up to $50M.
Why choose Debt Protect?
- Exclusive rates
By purchasing your credit insurance policy through Aon, you can access a clear and transparent pricing model based on turnover which makes it quick and easy to identify your premium. In addition to the competitive pricing, we have negotiated competitive policy terms and reduced credit limit fees.
- No more invoice chasing
As a trade credit insurance policyholder, you can access a team of global debt collection specialists. A ‘no collection, no fee’ service is provided, dependent on your level of coverage. You could also get up to 100% cover for collection costs and legal fees (excl. GST) which may result in savings. Collections support is available in any country.
- 24/7 online policy management
You can view and manage all your policy and credit limit information at any time and from anywhere with access to an online portal. Managing your trade credit insurance has never been easier.
- Fast-tracked claims
The claims process is fast and efficient helping you recover from your losses as quickly as possible. The insurer will assess trade credit insurance claims under $40,000 within 5 working days of receiving all claim documents.
No. 1 Global Credit Broker
Aon is the leading trade credit broker in terms of annual premium placement and as such we have a strong relationship with each key insurer to assist our clients to maximise value from the market.
Our team is one of the most experienced in the industry comprising of brokers and ex-insurers with many years of experience in the trade credit market. Our low client-to-broker ratio means we can actively service clients in all states.
Using our depth of understanding we negotiate a competitive combination of premium, cover and service, designed to meet the individual needs of our clients.
*Excluding GST and applicable taxes and charges. Subject to full policy terms and conditions. The pricing for Debt Protect is based upon 12 months cover. Debt Protect is subject to full terms, conditions and limits of the policy. Please review the full policy wording for more information.
A bad debt occurs when the money owed becomes unrecoverable, typically due to insolvency. The policy is designed to provide a safety net against unexpected losses but it can also help you avoid losses altogether. The insurer employs a team of analysts who review the credit profile of your clients and monitor financial information and payment experience to help you set credit limits. This can help you identify and avoid trading with businesses that are distressed. If an insured client becomes insolvent the policy reacts to ensure you get paid for the goods and services that you have supplied. The policy will cover up to 90% of the insured balance owing (minus your deductible) to ensure that your business can continue to operate with minimal disruption.
What claims are covered by trade credit insurance?
Standard cover can protect against insolvency and protracted default. However, you can also add protection for events such as political risk and orders commenced but not yet delivered (pre-delivery risk insurance). A policy can be structured to meet with the particular demands of your business and the territories in which you operate.
What are the benefits of insurance for trade credit?
A credit insurer becomes the eyes and ears on the ground for their client. They will check a prospective client’s stability, creditworthiness and reputation. Atradius, the insurer for Debt Protect has 160 offices in 50 countries around the world. Their combined underwriting team has live data on over 100 million businesses. Through their information, you can investigate the risk your customer’s credit terms pose to you.
If a customer fails to pay you, you have the protection of a policy to cover up to 90% (less your excess) of the outstanding amount to make sure that your business can continue unaffected. To make a claim for payment, all you have to do is log into the 24/7 online portal, complete the appropriate documents and your claim will be assessed by one of the insurer’s claims specialists.
Do I need credit insurance?
Some of the factors you may wish to consider when deciding if trade credit insurance is right for you:
Risk is an inherent part of credit based trade. Sometimes, it doesn’t matter how well you know your market and customers – insolvency and payment default are commercial realities. Despite sometimes knowing your buyers for many years, you can’t predict the future of their business. Almost every business has had a direct experience with a bad debt, and this impacts cashflow, profitability and confidence
The payments owed to you are often a large chunk of your assets. Your accounts receivable function is one of the largest assets on your balance sheet. Just as you insure other valuable assets such as your factory or your office property, you may want to consider the exposure that your outstanding payments pose to your balance sheet. Trade credit insurance can insure you against this risk.
Also, chasing non-payments can take up significant business resources. Credit insurance can allow you to maintain sales and reduce negative impacts of non-payment. This often frees up the time and resources otherwise spent chasing payments, to focus on growing your business.