5 Things to Check So Your Claim Doesn’t Get Knocked Back

We’ve just started working with a new client who came over from another broker. A couple of years ago, they’d taken a big hit with a retention loss. They didn’t want to go through that again, so they bought a trade credit insurance policy. That was a good choice. Credit insurance can be tricky when you’re new to it. There are lots of moving parts and it’s not always obvious what’s included. This client assumed that because they’d clearly said retentions were their biggest concern, the policy would cover them. A reasonable assumption, I think. The problem was, retentions cover doesn’t come standard with every model as it were … and their broker never asked for it despite it being the clear and obvious motivation for them to consider it in the first place.  It was offered by the insurer with only a small increase to the premium, but it wasn’t asked for.  They found that out when another loss was incurred and once more they were left with a large chunk of money tied up in retentions and no cover.

If you’re running a business, you’ve already got a hundred things to deal with and think about and you’re not an expert in credit insurance. But there are a few key things you do need to keep an eye on to make sure you’re protected:

1. Trading with the right entity – Make sure the name on your invoices — and the ABN/ACN — matches the legal entity listed in your policy. A mismatch here can wipe out a claim.
2. Payment terms – Do they match your policy? If your customers are on 60 days but the policy says 30 days EOM, you could be outside cover without realising.
3. Pre-delivery / Retentions cover – If these risks are relevant to your business, make sure they’re included. They don’t come standard with every policy.
4. Reporting overdue accounts – Policies usually require you to notify the insurer once a payment is overdue by a set number of days. Missing this is one of the top reasons claims get declined.
5. Adequate cover – Whether you have an endorsed limit or you’re trading under your discretionary limit, make sure your exposures stay within those limits.

For more information reach out to us today!