Credit Insurance – An Overview

Credit insurance is a financial product that protects businesses against the risk of non-payment by customers. It provides coverage for accounts receivable, safeguarding companies from losses due to insolvency, bankruptcy, or delayed payments by buyers. By securing receivables, credit insurance helps maintain healthy cash flow and supports business growth. Fastzeal offers easy access to credit insurance policies from top insurers, helping you manage credit risks effectively.

What is Credit Insurance?

Credit insurance is a type of insurance that protects sellers and lenders against losses arising from a buyer’s inability to pay for goods or services delivered on credit. It is commonly used by businesses to secure trade receivables and ensure financial stability, even when customers default or delay payments. This insurance plays a vital role in reducing bad debts and mitigating credit risk.

Types of Credit Insurance Policies

1. Domestic Credit Insurance

Covers losses from non-payment by customers within the same country.

2. Export Credit Insurance

Protects exporters against risks of non-payment by international buyers.

3. Single Buyer Policy

Insures credit risk associated with a specific key customer.

4. Portfolio Credit Insurance

Provides coverage for the entire portfolio of receivables from multiple customers.

5. Political Risk Insurance

Covers risks related to non-payment due to political events like war or government restrictions.

Benefits of Credit Insurance

• Risk Mitigation: Protects against losses caused by customer insolvency or payment default.
  
  

• Improved Cash Flow: Ensures consistent inflow of revenue by reducing payment uncertainties.
  
  

• Enhanced Credit Management: Provides access to credit information and risk assessment tools.
  
  

• Business Expansion: Allows companies to safely extend credit to new and existing customers.
  
  

• Loan Facilitation: Easier access to bank loans as insured receivables reduce lender risk.
  
  

• Professional Debt Collection: Some policies include debt recovery services.
  
  

• Financial Stability: Protects profit margins by minimizing the impact of bad debts.
  
  
  

Eligibility Criteria for Credit Insurance

• Businesses engaged in the sale of goods or services on credit.
  
  

• Companies with verifiable financial statements and credit history.
  
  

• Firms with established credit management practices.
  
  

• Age and turnover limits as specified by individual insurers.
  
  

• Compliance with insurer’s application and underwriting guidelines.
  
  
  

Documents Required for Credit Insurance

• Business registration and incorporation documents.
  
  

• Financial statements such as balance sheet and profit & loss account.
  
  

• Details of credit sales and customer profiles.
  
  

• Copies of credit agreements or invoices.
  
  

• Identification and address proofs of business owners or directors.
  
  

• Previous insurance policies (if applicable).
  
  
  

How to Buy Credit Insurance through Fastzeal?

1. Visit the Fastzeal website or mobile app.
   
   

2. Navigate to the Credit Insurance section.
   
   

3. Compare policies offered by leading insurers.
   
   

4. Select the most suitable credit insurance plan for your business.
   
   

5. Fill out the application with your business and customer details.
   
   

6. Upload the necessary documents securely.
   
   

7. Make the online payment for your premium.
   
   

8. Receive your policy instantly via email and through your Fastzeal account.
   
   
   

Key Features of Credit Insurance

• Coverage for domestic and international trade receivables.

• Protection against buyer insolvency, default, and delayed payments.

• Access to credit risk assessment reports.

• Option for customized coverage limits per buyer or portfolio.

• Debt collection and recovery support.

• Flexible policy terms and coverage options.

• Fast claim settlement process with expert assistance.