by Heather Smart Johnson
The Ultimate Guide To Submitting Your Business Credit Insurance Claim & Getting Paid
Your worst nightmare has come true – your biggest customer has not paid a substantial invoice. What are you going to do? Oh, wait. You have trade credit insurance for your business and this customer is covered by your policy. Phew.
But now what do you do?
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Getting Started Filing Your Claim
The first thing to do is actually BEFORE you have a delinquent customer. Make sure you know your policy. Here are some questions to make sure you know the answers to ahead of time:
- When are you eligible to file a claim?
- What steps need to be taken?
- How long do you have to wait to be eligible?
- Will the insurance company try to collect the debt and if so, how long will they try before you can get paid?
Tips For Getting Paid On Time
Here are some other tips to help your claims process go smoothly:
- File your claim on time. Your trade credit insurance policy usually includes a maximum claim filing period. This deadline gives the insurance company the best chance of recovering payment and mitigating their loss.
- Make sure the insurance company approves any repayment plan between you and your delinquent customer. If the customer does not make payments as agreed on the repayment plan, you may be able to file a claim. However, if the payment plan was not approved by the insurance company, your claim may be denied.
- Be a stickler to the terms of sale reflected on your invoice — and make sure your company is really providing goods or services according to these terms. The terms of sale on your invoice and other statements made on your insurance application are considered when the insurance company offers you a policy. If you need to make changes, it is best to contact the insurance company first and make sure they are in agreement. Otherwise, changes to these terms could lead you to be considered in breach of the policy and the claim may be denied.
- Know who you are dealing with and who is ultimately responsible for paying the debt. Identifying the responsible party may be easy when dealing with a small business. However, dealing with subsidiaries of large corporations may be more complex. In this case, do not assume that the larger corporation will be responsible. Your claim will be denied if it lists the wrong entity.
Dealing With Customer Disputes
If you file a credit insurance claim and your customer disputes it, the insurance company may not pay the claim until the dispute has been resolved. The insurance company does not act as a mediator between you and your customer in regards to the dispute. If legal action is required to resolve the dispute, the insurance company does not get involved but waits — and may set aside or reserve the claim payment — until the dispute is resolved. If the legal outcome of a dispute is in your favor and your customer still does not pay, the insurance company will release the claim payment. A customer dispute does not necessarily mean that a claim will be denied, but it will often delay it.
A trade credit insurance broker is an advocate for you when dealing with the credit insurance company. Let us help you find someone who will be a true partner and help you get paid.
We offer unbiased credit insurance specialists that find you the best credit insurance provider.
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