Types of credit insurance

Every business owner needs credit insurance cover. However, deciding on which one to go for at times becomes a challenge. Very few insurance service providers will tell you the one you need. In most cases, they tend to look at the type which is likely to earn them more income when you are offered. This is why you need to know what you need before consulting any firm. Well, here are some of the types of credit insurance covers that you might need:

  1. Single risk cover
    This is the most common policy that is likely to be recommended to you. It simply refers to the cover that you take to cover you against a single risk. If you are more exposed to given market risk, you are likely to get losses if you don’t have such a cover.
  2. Export risk cover
    Here is another policy that serves companies that deal with export regularly best. There is no way you should deal with exportation if you don’t consider having such a cover. There are a lot of risks as far as export and imports are concerned. For instance, import restrictions can arise due to second-party government restrictions. Such in most cases can expose you to losses that would otherwise be covered by your service provider.
  3. Political risk cover
    If you are operating your business in a state where political issues are most likely to arise, then you cannot fail to have such a cover. It protects your business in case your clients are not able to pay their debts due to political reasons. For instance, whenever there is political unrest in a country, businesses are likely to close so people lose jobs. In such instances, it is your insurance provider who carries the loss.