Trade Credit Insurance: Can You Renegotiate Your Contract?

Trade Credit Insurance: Can You Renegotiate Your Contract?

Credit insurance is a protective provision against various cash flow risks in a business. These include the risk of non-payment by your customers. Sometimes, however, the terms of business credit insurance no longer meet the needs or realities of your company. In this case, renegotiating his contract is an alternative that you should seriously consider. However, how do you do this?

You can renegotiate credit insurance based on contract history

The history of a trade credit insurance contract is the first criterion that can be renegotiated. Actually, Business credit insurance contract Often it is created for a period of one, two or three years. Depending on this duration, you can enter into direct negotiations with your insurance company or hire a broker to do it for you.

It should be noted that the term of the insurance contract obliges your insurance company to cover all of your company’s unpaid debts in the event that your customers default. In addition, during this period, your company benefits from many services such as screening and monitoring of potential customers. Apart from these services, the insurance company can provide youDebt collection service. However, its primary role is to ensure compensation for all your outstanding debts.

If your insurance contract is a few months away from the anniversary date, you can consider changing the insurance company when the terms don’t suit you. So there are high performing tools these days that allow you to get a detailed comparative study of the insurance solutions in the market in just a few clicks.

In addition, your credit insurance contract could have been drawn up during a period when rates or business claims were very high. In this case, renegotiating your contract will save you a lot of money. Note that credit insurers have developed risk analysis and forecasting methods to develop highly relevant models. Thanks to these tools, it is now possible Better anticipate unpaid bills By rating the company’s customers.

What is the notice period?

A business credit insurance contract contains several clauses that govern the relationship between the insurance company and the company. Among these clauses, we find those relating to breach of contract. These are the texts that clearly regulate the conditions to be observed in the event of termination of the contract with the insurance company. The notice period appears among these terms. It corresponds to the notice period you give your insurance company.

Depending on the company, notice period It may be a month, two or three months before the expiration date of the contract. Note that it is essential that you quickly send your revocation letter to the insurance company. You may do this as a precaution to inform the insurance company in advance that you wish to terminate your contract.

The denunciation letter must be sent by registered mail to the insurance company. Thanks to this letter, you can either Change of insurance company On the date your contract ends, or continue with your insurance company when their terms suit you.

Compare offers from several credit insurance companies

When considering renegotiating your credit insurance contract, it is important to compare offers available in the market. This allows you to get a fairly accurate idea of ​​the market reality regarding this type of coverage. Having this information allows you to discuss your point of view when you want to obtain more favorable terms from your current insurance contract. Likewise, if you are planning to change the insurance company, comparing the offers available in the market allows you to choose one that suits you perfectly.

Comparing offers can be done in different ways. We recommend usingCredit insurance comparison for online business. These are handy tools that make multiple offers at once, with just a few clicks. You will then be able to select solutions that perfectly match your tastes and the needs of the company. To compare offers offered by insurance companies, you should look at:

  • at an excellent price,
  • reporting threshold exemption,
  • an “indefinite” amount,
  • at the exchange rate,
  • Collateral shares.

You also have to watch out for extra costs and make sure they don’t hit your budget. These fees are often charged by insurance companies to cover new customer surveys, Dispute settlement procedures and continuous monitoring of approvals.

Ask your insurance company about your various statistics

with a purpose Re-negotiate your insurance contractAsk your insurance company to provide you with an update on your stats. The professional will then have to communicate with you:

  • paid annuity (PP),
  • Police Technical Balance (STP),
  • paid claims (SP),
  • Outstanding Claims (SS).

Once you have this various data, you can make an in-depth analysis of the suitability of the insurance company’s offer.

Can only a few points of the contract be negotiated?

A credit insurance contract can only be negotiated with respect to certain points of interest to you. This may be the term of the contract, exclusions, deadlines, additional bonuses, discounts, coverage percentages, rates, and so on.

when you want Negotiate a few points of your business credit insurance contract, be sure to move on. This means, for example, asking the company about its upcoming pricing even before the start of the new year. If you know these rates, you should compare them to the average rates of other insurance companies in the market. You will then be able to better visualize yourself in time, for example, by making financial forecasts that are useful for a good organization of the company.

Note that Insurance companies Don’t always agree to announce their next prices before the start of the new year. In this case, they could intentionally delay your action and extend the notice period over which you have influence. It is possible to take advantage of this situation in your negotiations to get a better offer.

Some arguments allow you to get better options for Hold your credit insurance after negotiations. For example, you can highlight the fact that the number of your orders has decreased or that your company plans to take actions to increase its sales.

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