Although we always attempt to clarify those interested about all that is involved in credit insurance: the benefits for the company, the benefits for the professional staff, and sales security; many people, prior to contracting this type of insurance policy, come to us with recurrent doubts, so here we are to clarify the main doubts of our clients. See below!
1. Is credit insurance mandatory for the company’s entire client portfolio?
Many believe that credit insurance provides cover only for the entire client portfolio of a company, but that is not true.
Credit insurance allows for flexibility in choosing which clients you want to insure under the policy. And only a specialized insurance broker is able to provide adequate guidance, after all, the role of the broker is precisely to determine where the best advantages lie for the client.
2. Can I contract this insurance for one client only?
This question is usually very frequent, as some companies often have a very large client in their portfolio.
Yes, this type of coverage is possible, and its name is, “single-buyer”, however, in our role as insurance brokers, we must clarify what are the pros and cons of this type of insurance placement.
The placement of single-buyer insurance is very expensive, because it covers one single risk evaluated by the company. We suggest that the company should place insurance for, at least, 4 or 5 clients of its portfolio as, in this manner, the cover would be decharacterized as single-buyer insurance, there would be a fairer balance in the insured portfolio, and moreover the pricing of the insurance contract would be reduced.
3. Can I insure a public entity client?
No. A clear indication concerning this type of entity is provided when, for instance, a pharmaceutical company sells 50% to private clinics, and 50% to public hospitals.
The underwriters, however, do not provide cover for the latter group, because it is not a credit risk, but rather delays in the release of funds to public entities.
Do you have other doubts? We have developed a definitive guide for you to learn all about Credit Insurance, and no longer have any worries when contracting this insurance!