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Solve all your doubts about credit insurance through the most frequently asked questions from our users and clients. Remember that if you do not find what you are looking for, you can contact us and we will help you find the most appropriate solution.

About credit insurance

What is credit risk?

Credit risk is the potential loss that a company assumes when it sells forward, as a result of the non-compliance with the payment obligations of its customers.

This non-payment may be caused by financial insolvency, lack of liquidity, or by our client’s unintentional or intentional carelessness. Our analysts’ job is to find out if this risk exists, quantify it and insure it. Globalization brings opportunities and risks. Companies are becoming larger and their client portfolios are becoming more diversified. It is often very difficult to control to whom they sell, whether it is safe to give them credit or even whether it is safe to sell to them.


My company offers services rather than products, can I take out credit insurance?

Yes, coverage is available for both products and services. Whenever a business-to-business credit sale is made, it is possible and highly advisable to take out insurance.

If I sell to the public sector, do I have to include this in the turnover to be insured?

No. Regarding the public sector buyer, it is considered that there is no risk of default. You will only pay for the insurable turnover.

What is the incurable volume of turnover?

The incurable volume of turnover can be partially or fully covered, depending on your needs. You will not have to pay for the entire portfolio if the subscriber declines any coverage.

Can the insurer withdraw coverage during the term of the policy?

The insurer commits a lot of resources to monitor the credit risk, if they have negative information about a policyholder, they may decline future cover but the goods or services that have already been provided are always covered.

*At ABK we propose a unique and adaptable solution to solve this problem. For more information contact us.

What if I am obligated to provide but the subscriber cuts off my credit limit?

Most credit insurance policies have a clause that allows a 30-day grace period for the business to continue while new information is sought to reassess the situation. If your sales contract is legally binding, such coverage can be added. The cover will be maintained unless it is evident that the buyer is about to fail.

ABK Credit proposes a unique and adaptable solution to solve this problem. Please contact us for more information.

What does credit insurance cover?

Credit insurance covers non-payment by a debtor company, due to insolvency de factual (“disappearance of the debtor or non-payment”) or de jure (insolvency proceedings).

Do I have to cover all my customers?

In general, the most efficient and cost-effective policy in the market is to cover the entire volume of business, but we take care to adapt to your needs and preferences to find the best option for each case. You will have the best coverage at the lowest possible price.

Does the insurer set the coverage for all my clients?

Most insurers set a discretionary credit limit, below which they grant rating autonomy to the policyholder. An insured can maximise coverage by using commercial experience of payment behaviour and other means to justify insured credit limits.

ABK offers the solution to achieve maximum autonomy in the classification of buyers, to be discussed in a personal or digital interview. Contact us for more information.


How much will it cost me?

Minimum premiums are set for a 12-month period and currently stand at around 3,000€.

About reviewing an existing policy

How can I be sure that I have the most appropriate policy for my needs?

There are a large number of different types of coverage available in the market. Insurers are continually introducing new services and concepts. We are constantly learning and innovating hand in hand with clients and insurers to be able to offer the most optimal and up-to-date solution for your company.

Is my current credit insurance company providing me with the best coverage available in the market?

We don’t like to talk about third parties, so we can only say that ABK will, at each renewal, establish if there are any gaps in the coverage and will carry out a complete analyisis of the market to compare both the price and the coverage, so that you can be sure that your policy will offer you the best coverage at the best price.

How do I know if my broker is giving me the best service?

Your broker should support buyer credit limit applications and claims recoveries, demonstrating at renewal that your current conditions are the best available in the market. We believe that this is best done by an independent and specialist broker such as ABK. We understand that it is essential to avoid contracting directly with insurers or agents who will always go in favour of the insurer in the event of substantial discrepancies.

Do you have a local broker for me?

ABK has full presence and scope in the Iberian Peninsula and as a founding member of CREDEA, we also offer worldwide support.

What can ABK Credit offer, what is different?

Let us explain the differences in depth in a personal interview, conference or Webex/Skype, which we can arrange via our contact page.

About export

Can I operate in cash against delivery of documents through the banking system? Do I need to get coverage?

Insurance companies differ on this point. The risk of a foreign bank releasing title documents without payment is real and occurs frequently, as does the failure of a foreign bank. Risk assessment will be on your side, but coverage is available.

What does export credit insurance cover?

In addition to your client’s default, the coverage extends to political risk, i.e. currency inconvertibility. It may happen that an importer has funds in local currency and the government imposes restrictions on currency exchange and default occurs due to the impossibility to exchange into € or US $.

If my buyer refuses to pay, can I claim?

Credit insurers have built an extensive support network to help collect overdue accounts in foreign countries, but if this fails, the claim will be paid within 6 months of the due date. You do not have to worry about negotiating legal fees or other fees in export markets.

I only have a few export accounts on credit terms, is there a policy for this?

This is likely to be determined by the cost levels and the minimum premium of export policies, which are generally higher than national ones. In any case, we will study the individual case to adapt the insurance to what is convenient for your case.

About the coverage of major buyers

You are happy that most of your customer portfolio has acceptable credit risk but you are concerned about any major accounts? Can only one customer be selected for coverage?

Yes, but this may not be the best option. In these cases, insurers will apply higher minimum premium levels. Selecting the entire volume of business or a large group of accounts may be a better option. I have received denial of subscriber coverage.

Can I ask another insurer to cover the risk?

As long as the coverage is not too high, above €300,000, change the subscriber. You should ask ABK to review the coverage to verify.

How much would it cost me to cover a single account?

Unlike full turnover cover and most other policies, in the case of a single buyer a price is set on the value of the credit limit rather than the insurable turnover. As you would expect, the price is based on the strength and potential of the buyer and the insured value, which means that rates will vary from a fraction of a percent up to 8% or 9%.

About financial support

Are you looking for alternative financing options and want to maximise the value of your debtor item as collateral for factoring or working capital financing from a bank?

Having the insurance portfolio 100% insured is a key strategy to improve the financing capacity of working capital. Factoring companies and banks tend to give better conditions if the invoices are insured and the financier is the beneficiary.

My factoring company has offered me insurance through them on ceded invoices.

Separating your credit insurance provider from your funder provides more flexibility and saves money depending on a number of criteria. You should discuss this with one of our subscribers.

Will credit insurance cover my existing debtors?

Most credit insurance policies cover debt for dates within the policy period created through payment (fixed risks). When starting a policy, it should be agreed that the historical debts of those buyers who were not in default at the date of inception of cover will be included.