What is the definition of Credit Insurance?

Credit Insurance provides protection to individuals and businesses for debt that their creditors fail to pay. This protects the insured from being wiped out, especially if the insured is dependent on only a few big accounts. The insolvency of one of the clients may very well wipe them out as well.

Credit insurance is beneficial to both the lender and the debtor. The lender is assured that he will receive payment even if the debtor dies or is declared insolvent. On the other hand, it benefits the debtor in that he knows that outstanding debts will be eventually settled.

For businesses, this help in managing accounts receivable. Credit Insurance is mainly bought by wholesalers, manufacturers and service providers. When a client cannot pay for his outstanding accounts, the insured business can make a claim to the insurance company. Usually, there are set limits as to the maximum amount of coverage a business can get with respect to credit insurance.

• Competitive State Fund
• Captive Agent
• Blanket Insurance
• Businessowners Policy / BOP
• Employer’s Liability