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Protecting your business with credit insurance

One of the most important and largest business assets for any company will be your debtors, which often remain at risk with no insurance cover.

The recent collapse of Carillion is a harsh reminder of how destructive the consequences of insolvency can be. Leaving debts in the region of £1.5bn in its wake, numerous business are facing a tough time ahead and with less than a penny in every pound being repaid to creditors some may struggle to stay afloat. Many construction companies perceive that they are trading with a ‘safe’ customer but are unaware of the risks further up the chain. A main contractor’s insolvency can often result in numerous levels below being affected, with the insolvency of sub-contractors an unfortunate and inevitable consequence.

Coupled with political and economic ambiguities which continue to dominate the landscape, insurers are fearful insolvencies will rise in all trade sectors during the next few months and years. The latter part of 2017 saw the demise of Monarch Airlines, Palmer & Harvey McLane (the UK’s fifth largest private company), Multiyork, Feather & Black, and Just For Pets as well as a CVA (Company Voluntary Arrangement) for Toys ‘R’ Us. As this article is published, financial issues surround Poundland, Bensons For Beds, and Harveys and numerous retailers have reported poor festive sales As such, now is a good time to make provisions for insolvencies amongst your debtors which could affect your cash-flow.

Whilst there is no direct correlation between the collapse of Carillion and farming businesses, the inevitable domino effect is likely to affect smaller business who may not have been directly affected initially. The agricultural industry is not exempt from circumstances of this nature either and was recently affected following the collapse of industry household names including Wellgrain, Bernard Matthews and Preva Produce.

With access to a wide range of insurers and schemes underwritten by industry leaders, Atradius and QBE, AF Insurance is able to offer protection for its members. Whether you’re seeking protection for single or multiple customers we can discuss and review your requirements. We can also cater for extended payment terms and arrange cover for self-billing trade in the agricultural & horticultural industries as well as applications for payment & retention payments in the construction industry. Some credit insurers also provide a free or contributory debt collection and legal service for those customers which don’t go bust but from which are difficult to extract payment.

AF Insurance Business Manager said: “In a constantly changing political and economic time, it’s wise to consider the options available to help protect your business. Credit Insurance gives business owners peace of mind, allowing them
to get on and run their business without the added worry and stress of their customers’ financial well-being”.

Premiums vary according to the risk profile involved. If you would like a quotation or would like to discuss the options available, please contact Richard Hastings, AF Insurance Business Manager, on 01603 881 874 or email richard.hastings@theAFgroup.co.uk.

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