13 June 2024
When faced with bad debts, your business needs to know it has an insurance safety net. Learn how our experts handle your claims effectively.
Summary
Key Takeaways
- Trade credit insurance provides a safety net for businesses unable to recover overdue payments, ensuring swift and smooth claim processing by professional assessors.
- Our expert claims team provide guidance to minimize claim rejections, emphasizing policy compliance, documentation, and timely notifications to safeguard client cash flow.
Interested in Trade Credit Insurance?
No one relishes the prospect of making an insurance claim. But when your business has found it impossible to recover a substantial overdue payment from a customer, it’s reassuring to know that trade credit insurance is there as a safety net.
Whether your organisation is a mid-sized business or a multinational, our highly professional claims teams are on hand at that decision point to guide you through the process, evaluate the claim and indemnify you as swiftly and smoothly as possible.
To bring that process to life, we asked the insights of Yash Nilesh, Head of Claims & Collections, Ahmad Alhaj, Senior Credit Claims & Collections Officer and Pushpa Vekaria, Senior Claims & Collections Officer.
As Pushpa explains "Trade Credit Insurance is ultimately about safeguarding our clients' cash flow. When an invoice becomes significantly overdue and efforts to collect payment have been exhausted, having Trade Credit Insurance assures clients that, as outlined in their policy, they will receive a pay out"
"Our goal is to ensure that our clients receive a preliminary assessment of the case within five business days of filing their Claim. Our aim is to promptly reassure our clients regarding the validity of their claim as per policy conditions, ensuring full transparency along with anticipated payment timeline. We are always there for our clients, to provide guidance on any outstanding actions they may need to take, and provide regular updates throughout the claims process."
This approach is clear at Allianz Trade Middle East, which helps both SMEs and large global clients with trade credit.
"We give our clients different products, ranging from solutions for local clients through Corporate Advantage or for global clients through World Policy. Our job is to ensure all claims in the Middle East are handled with the highest quality of service," says Yash.
Each country within the Middle East has different laws and regulations. "Our challenge is to provide a seamless solution to mitigate the client’s bad debt, when possible through both claims and collections." says Ahmad.
The service is the same in the 8 countries where Allianz Trade in Middle East operates, but the number of claims varies a lot. "Some customers have hundreds of claims a year, and a single claim can involve many transactions. We also have clients who have never made a claim, and everything in between," says Ahmad.
As outlined by Pushpa: "Our claims assessors draw on extensive knowledge and experience in claims processing within both global and local legal and financial frameworks. They have expertise in the daily trading practices of various industries"
As a Claim Assessor, you may handle 10 new claims each day, and each one will be unique. Therefore, understanding the clients’ nature of business / industry and knowing the policy inside out, is crucial for success in this role.
No matter how complex the situation, the ultimate goal is to successfully process our clients claim payment with efficiency, and safeguard our clients’ cash-flow.
Our trade credit insurance stands out because we are experts and focus on our customers, says Ahmad. "We've been working hard for years to refine our service and communications with our customers. We also have monthly meetings with our brokers to anticipate upcoming claim payments and ensure they are done on time."
Ahmad also thinks consistent service makes Allianz Trade a leader. "What makes us different is our consistent quality throughout the organization," he says.
Part of that service-focused approach is to provide guidance to clients at different points, to reduce instances of claim rejection.
“Only about 5% of claims from our clients are declined – and this number is constantly monitored to identify customers with a high rejection rate, and provide them with tailormade advice to avoid such cases” says Yash.
“Our advice to clients is to always know your policy timelines – even before you need to make a claim,” says Yash. “We monitor the top reasons for claim rejections and advise clients to be mindful of these at the inception stage.”
“The most important aspect of the policy is to be compliant with the policy timeline. After the due date on the invoice passes, in general we expect clients to take 60 to 90 days to try to work things out with their customer before they declare a state of default notification to us,” says Yash. “We advise policyholders to be aware of their maximum payment terms and maximum extension period as per the policy and monitor any delays regularly in order to ensure their claim is approved. We also advise clients to ensure their buyer is not in a state of default when making new supplies.”
“We never want a claim to be denied but the fact that the overdue or claim has not been notified to us within the required timeframe is the most common reason that a claim is rejected,” highlights Yash.
Yash has further advice for those anticipating that they might need to make a claim one day. “When you enter into any kind of trade, make sure everything is very well documented. Always keep track of all your invoices, due dates, buyer’s acknowledgement of payment terms and delivery notes, so as not to miss deadlines or lack the documentation as required in the policy,” he says.
“This helps us quickly assess your claim and reduce the need for follow up clarifications,” Yash outlines.
Ahmad outlines "We always try to keep in mind that we want to treat our clients in the same the way we’d want to be treated ourselves"
"I think it’s all about the people. It is a privilege to work with our clients and brokers out of so many industries and cultures" says Puspha
Yash notes "It is incredibly rewarding to find a solution that reduces our clients’ losses, whether through claim indemnifications or through a creative and effective collections approach"