United Kingdom

Trade Credit Insurance: Supporting your business to prosper and grow safely

Minimise credit risk and free up working capital with a trade credit insurance solution from Aon.

Trade credit insurance can help businesses of all types and sizes to maximise liquidity and offset credit risk. Yet our research shows that only two in 10 CFOs make use of it today.

As a leading credit risk insurance broker, Aon can find you a trade credit insurance solution to support stability and growth for your business in uncertain times or in volatile markets.

 

What is trade credit insurance?

Trade credit insurance protects your business against bad debts from the insolvency or protracted default (inability to pay) of business customers who have received goods or services on credit from you.

It can protect your business in both domestic and export markets, giving you peace of mind wherever you trade.

 

What types of trade credit insurance can Aon provide?

With access to the whole of the credit insurance market, Aon can research and tailor a trade credit insurance policy that meets the specific needs of your business. Popular policy types include:

Whole Turnover: This type of policy covers all of your accounts receivable, either worldwide or in a specific geographical region.

Key or Single Account: This type of policy covers one or more of your key customers, giving you confidence to expand your business with them.

Top Up: A policy that extends the limit of a trade credit insurance policy you may have with another provider, giving you additional peace of mind when growing your business.

Excess of Loss: Sometimes also called “catastrophe policy”, this covers you for exceptional losses over and above normal levels of bad debt.

The credit insurance market is constantly evolving, and we keep pace with every development to ensure we can always find the right solution for our clients. Even if you already have trade credit insurance in place, it’s worth getting in touch to see if we can recommend a solution that better supports your needs and growth plans.

 

Four reasons to choose trade credit insurance for your business

There are four key benefits your business can gain from trade credit insurance – ranging from protection against bad debts to the confidence to transact more business with key customers.

1. Protect against bad debt

Transfer risk to the insurer: Trade credit insurance removes credit risk from your balance sheet and transfers it to your chosen insurer, improving your margins and bolstering your P&L.

Reduce bad debt provision: As potential losses are covered, you can reallocate excess bad debt provision as working capital.

Avoid potential losses: Aon’s credit risk analysts and trade sector specialists can provide invaluable insight into your clients, their sector, and any associated political risk.

 

2. Empower business growth

Offer credit with confidence: Trade credit insurance reinforces your credit management processes, allowing you to safely extend payment terms to customers in existing and new markets.

Maximise business with key accounts: We offer top or key account cover to support sales to specific customers or high-level margin markets.

De-risk mergers and acquisitions: Trade credit insurance protects investee companies against bad debt from acquired or merged customer portfolios.

 

3. Increase working capital

Improve access to finance: Trade credit insurance can improve your credit rating and increase the confidence of potential financing partners, allowing you to secure more favourable financing terms.

Minimise debtor assets: Use the debtor asset on your balance sheet to free up working capital by unitising invoice discounting or factoring.

Replace expensive guarantees: Use trade credit insurance as a cost-effective replacement for expensive bank guarantees and letters of credit.

 

4. Gain competitive edge

Safely extend credit terms: Trade credit insurance removes the fear of not getting paid, so you can offer extended payment terms to customers.

Improve credit control: The disciplines within your trade credit insurance policy support best-practice credit management processes, reinforcing your existing procedures.

Tap into specialist expertise: Aon’s credit risk specialists will help you set credit limits on your customers and, in the event of a claim, assist with the management of recoveries and salvage.

 

Ask us about trade credit insurance today

To find out more about insuring your trade credit risk, contact our Trade Credit Insurance team today. Alternatively, fill in our quotation request form and one of our brokers will get back to you as soon as possible.

To find out more about Trade Credit Insurance or to get a quote from our team, contact us today.

 

Aon UK Limited is authorised and regulated by the Financial Conduct Authority. FPNAT511