Trade Credit

Trade Credit

Trade Credit Insurance safeguards businesses from financial losses due to customer payment defaults and delayed payments, ensuring a steady cash flow and reducing the risk of bad debt.

Overview

In a competitive marketplace, extending credit to customers is often vital for growth — but it comes with the risk of non-payment. Trade Credit Insurance protects businesses by covering losses incurred when customers fail to pay for goods or services due to insolvency, protracted default, or economic downturns. This coverage allows companies to confidently expand their sales on credit, secure better financing terms, and maintain financial stability even in volatile market conditions.

FAQs

  • Manufacturers & Suppliers : Companies with significant receivables from distributors and retailers.
  • Exporters & Importers : Businesses facing cross-border payment risks and currency fluctuations.
  • Retailers & Wholesalers : Firms extending trade credit to customers in competitive markets.
  • Financial Institutions : Lenders looking to protect their loan portfolios against customer defaults.
  • Businesses in Volatile Markets : Companies operating in sectors prone to economic and financial uncertainties.

  • Buyer Insolvency : Covers losses when a customer becomes insolvent or declares bankruptcy, resulting in non-payment of invoices.
  • Protracted Default : Provides coverage when a customer fails to pay within the agreed credit period, ensuring that prolonged non-payment losses are mitigated.
  • Political/Economic Disruptions (if included) : In some policies, losses arising from adverse political or economic conditions that prevent customer payments are covered.
  • Invoice-Level Losses : Protects a predetermined percentage of outstanding receivables up to the policy limit, compensating for the financial impact of unpaid invoices.

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DISCLOSURE

EDME INSURANCE BROKERS LTD. (FORMERLY KNOWN AS ADITYA BIRLA INSURANCE BROKERS LTD.)

Registered Office: 2nd Floor, Privillion, East Wing, Sarkhej - Gandhinagar Highway, Vikram Nagar, Bodakdev, Ahmedabad, Gujarat 380054. IRDAI License Number: 146 | Composite Broker | License Valid till: 9th April, 2027 | CIN: U99999GJ2001PLC062239 Corporate Office: VIOS Tower, 6th floor, Off Eastern Express Highway, Sewri - Chembur Rd, Mumbai – 400037 Telephone: 1800 120 2510 | Website: www.edmeinsurance.com In case of any queries/complaints/grievances, please write to us at clientfeedback@edmeinsurance.com.