Credit insurance protects businesses from losses that may occur due to the failure of their customers to pay and acts as a factor in growing and maximizing their profitability.
Extroversion and sales growth are very often associated with increased credit risk. For this reason shielding a company's balance sheet from bad debts is vital.
Credit insurance is the most effective tool for transferring the risk of bad debts off the balance sheet of a company, which frees up working capital and strengthens its development path.
In addition to its direct contribution to the reduction of credit risk, credit insurance is also a very powerful tool for predicting and evaluating the creditworthiness of a company's customers, especially in cases where it plans to enter new markets, or extend the credit limit to existing ones its customers.
Essential Benefits
Protection against bad debts
The risk of non-payment of receivables is reduced, thereby transferring the risk of bad debts off a company's balance sheet. In this way, the assets increase and its net worth improves.
Protection of liquidity and strengthening of working capital
The gap that can be caused by a risk in the liquidity of a business is covered, as a result of which its liquidity is protected and its working capital is strengthened, as well as its overall financial position.
Strengthen credit risk management practices
It helps a company's credit control department to enhance existing credit risk management practices through a more cost-effective way of managing it and enables it to cover the costs and management needs associated with recovery actions.
Early warning of looming credit risk and enhancement of business development
It provides the possibility of early forecasting and avoidance of risks, with the result that the company can draw up its credit policy in a rational way and use it actively in order to increase its competitiveness, such as e.g. providing higher credit limits to customers who are of low credit risk. Through the active management of credit risk, the development potential of the company is significantly enhanced.
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Our team is here to help you out with any questions you may have.
The GAP Vassilopoulos Group acts as Brokers through their well-established relationships with international ‘A’ Rated insurers’ as well as the local Cyprus market can cater for a wide range of insurance products.
Drop us an email through our website or feel free to contact us at 77 77 77 75 to compare and select the most appropriate insurance policy with our specialized G.A.P. Insurance Agency whom will respond promptly to your needs.