Trade Credit Insurance

Credit Insurance is designed to protect sellers from non-payment, owing to Commercial & Political Risks, and to enable them to expand their business without fear of loss. Credit insurance also facilitates liberal credit facilities from banks/ financing companies. Under the domestic credit insurance policy, defaulting on payment of goods and services on open credit terms is covered except in the case of cash, advance or letter of credit.

Receivables form a lion’s share of current assets of any business and need to be insured like fixed assets. Selling on credit terms involves Commercial Risks such as default & Insolvency of buyers.

In case of exports, risks such as Political Instability, Import Restrictions, Contract Cancellations, Trade War are ever present threats. These risks can be covered under Export Credit Insurance policy. Companies having local as well as export sales may cover all their credit risks under a combined single Credit Insurance Policy.

UNISON has experienced credit insurance professionals capable of designing a customized credit insurance policy that satisfies the specific needs of any business entity. We have formed partnerships with all the public insurers including ECGC as well as private sector insurers for Procuring, Arranging and Servicing credit insurance covers.

The policy cover may be issued on Whole Turnover or Selective Basis depending on sales profile and the insurer involved. Premiums depend on factors like rating of the buyer/country, credit terms, past payment record, industry profile etc. and are calculated as a percentage of sales turnover or exposure depending on the type of policy.

Key Coverages:
Commercial Risk
  • Insolvency of buyer or the LC (Letter of Credit) opening bank
  • Default of buyer in respect of accepted liability
  • Repudiation including non-acceptance of bills
Political Risk (In case of Export)
  • War & Internal strives in importing country
  • Cancellation of import licence
  • Foreign exchange restrictions & embargo