ABI issues post-Brexit guidelines on trade credit insurance cover

A new guide has been released by the Association of British Insurers (ABI) designed to help companies grappling with trade credit insurance cover in the context of uncertain times including the UK’s decision to leave the European Union.

“The ABI’s new Trade Credit Insurance Guide gives businesses all the information they need to know to help them grow their business in these uncertain times,” noted Mark Shepherd, ABI’s assistant director and head of property, commercial & specialist lines.

Credit insurance provides cover against the risk of not being paid for goods or services that businesses sell. “Should a customer be unable to pay its debts, credit insurance will pay out a percentage of the outstanding amount owed (typically around 90%)," he said.

The new guidelines also explain what will not be covered under the policy, including currency devaluation, debt and bribery among others.

“Trade credit is always there for business owners, not just when a claim is made and insurers have the right people with the right skills to help companies mitigate risks such as non-payment or improve access to funding, from banks and financial institutions often at more competitive rates,” said Shepherd.