Knowing me, knowing you: what buyers and suppliers need to know about measuring risk and managing credit insurers
Credit insurance is unlike other forms of insurance; the levels of cover can be cut and withdrawn at very short notice. The impact on buyers and suppliers alike can be devastating; it can adversely affect supply chain and cash flow, and the withdrawal of credit insurance for suppliers can also attract extra and unwelcome attention from stakeholders into the finances of the buyer.
The Government's scheme to top-up credit insurance will help some firms, but not the huge number that have seen their cover reduced before 1 April 2009 or withdrawn altogether.
The reality for many companies is that credit insurers are an increasingly powerful financial stakeholder. If you are a buyer, do you know how many of your suppliers have credit insurance? If so, what is the level of cover and which insurer is the policy with? In this context, whether you are a supplier, buyer, or both, what key areas should you consider to mitigate your risk?
We can help you measure your risk and manage credit insurers:
Click here for the full Credit risk report
Read our 2011 survey on credit insurance Credit insurance: good value or not?