Professional Documents
Culture Documents
ON
CREDIT INSURANCE
SUBMITTED
IN PARTIAL FULFILLMENT OF REQUIREMENT FOR THE
AWARD OF DEGREE OF
B. Com (Banking & Insurance)
BY
AKSHAT MAHENDRA
ROLL NO. - 32
CERTIFICATE
This is to certify that MR. AKSHAT MAHENDRA OF T.Y. B.COM
(BANKING & INSURANCE) Semester VI (2017-2018) has successfully
completed the project on “CREDIT INSURANCE” under the guidance of
Prof. Rinki Rajwani.
PROJECT SUPERVISOR:
COURSE CO-ORDINATOR:
INTERNAL EXAMINER
EXTERNAL EXAMINER
PRINCIPAL
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DECLARATION
SIGNATURE
ROLL NO.-32
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ACKNOWLEDGEMENT
to the making of this project. I oblige thanks to all who supported, provided
their valuable guidance and helped for the accomplishment of this project.
explore the urbanization which includes not only thinking and analyzing
various facts and updates about real work, our principal Dr. (Mr.) NARESH
CHANDRA and the course coordinator for having such wonderful course.
I am very much grateful to my project guide Prof. Rinki Rajwani who in spite of
busy schedule spent valuable time to guide me and helped in completion of this
project.
I also extent my hearty thanks to all my family, friends and all the well-
wisher.
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Project synopsis
BACKGROUND OF THE STUDY
Credit insurance indemnifies the policyholder against loss resulting from the non-receipt of
payment in respect of a transaction approved by the credit insurer. Such transaction must
provide for the supply of goods or services on credit terms by the policyholder to a buyer.
The largest current asset on most balance sheets is the Accounts Receivable. It is, as a result,
an important element of collateral for many lenders. Enhancing that asset’s quality with
Accounts Receivable (Credit) Insurance can be a good choice for a bank and for the creditor.
RESEARCH PROBLEMS
• Issue relating to the concept of credit insurance
• Issue relating to claim settlement
• Overdue Ineligibles
• Purchase Order Protection
• Issue related to policy premium
• Claims rejected for 'non-disclosure'
• Valuations
• Problems at renewal
• Advance Rate Increases
• Cost of Funds
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OBJECTIVES OF THE STUDY
• To understand the concept of credit insurance.
• To know about the various features of the credit insurance.
• To study the importance of credit insurance.
• To understand different aspects of credit insurance in relation with their claim settlement.
• To offer suggestions based on findings of the study.
SAMPLING MEHTOD
Method used for sampling is survey method. A questionnaire is generated from the literature
reviews and circulated to 40 candidates from the peoples who have experience in the
particular banking field mainly insurance customers, insurance staff, etc.
ANALYSIS OF DATA
Primary data collected from the respondents is later analyzed in MS excel and data are
converted into different analysis formats such as average score analysis, gender vise
percentage analysis, descriptive statistics, etc.
All 10 variables are studied individually in study of variable.
KEY FINDINGS
From the analysis it is found that the awareness of credit insurance is not much and its
doesn’t known to the people that they can insure their credit that they have given to the
debtors and, but the scope of credit insurance is much wider, and the factors likes bad debts
and credit losses driving the robust growth of credit risk insurance in India. It also found that
credit insurance reduces the credit risk and helps to survive in the difficult financial time or
crisis.
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SUGGESTIONS
From the finding we found that the credit insurance companies should spread the awareness
amongst people about the credit insurance and their benefits to them because many of the
people are not aware of it. It is also important that the premium rates should be calculated
correctly and having proper nominal rates of the premium according to the amount of credit.
It is quite known to the exporters and importer as the trade credit insurance, but it should not
be limited to exporters and importers but known to all the businessmen and other people who
engage in the money lending business also.
CONCLUSION
From this we can conclude that credit insurance is an important and essential and is also
beneficial for the businessmen. Credit Insurance is one of the new type of insurance in India
that is very important and providing benefits to businessmen whose business runs on the
credit who have their transactions mainly on credit basis. Trade is the engine of the global
economy. It allows companies to grow, compete and improve on their products. Trade creates
jobs and investments. Security of lended amount gives peace to the customers.
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Contents
1 Chapter 1: Introduction ..........................................................................................................1
1.4 Advantages/Disadvantages/Benefits/Limitations
(https://www.onemainsolutions.com/products/credit-insurance)...........................................7
2.7 .......................................................................................................................................27
2.10 .....................................................................................................................................28
5 Bibliography..........................................................................................................................54
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List of figures
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1 Chapter 1: Introduction
Credit insurance is an umbrella term that refers to insurance products offered by or through a
lender in conjunction with some form of consumer credit. The lender may be a bank, credit
union, seller of goods, or a lending company offering consumer credit in the form of a non-
The purpose of credit insurance is to offer the borrower protection against defaulting
on the loan, sometimes by covering payments for a period and in other cases by
paying off the balance of the loan. If the consumer can’t pay back the lender because
of one or several specific events, then the consumer contacts the insurer who in turn
will make payments to the lender. Instances when a credit insurance claim can be
made:
• If a borrower dies, then a credit life insurance policy will pay some or all of the
remaining debt.
• If a borrower becomes unable to work due to a disability, then credit accident and
health insurance will make monthly payments. Credit accident and health is
• If the borrower loses his or her job for a reason outside of job performance, then
credit involuntary unemployment insurance will make monthly payments on the loan.
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The policies can provide cancellation benefits, where a claim triggers the full
repayment of the outstanding debt, or it can offer suspension benefits, where loan
payments are not due and do not accrue interest for a period of time. In a declining
benefit policy, the amount of the benefit declines with each payment on the associated
loan. At the time of a claim event, the benefit is the total of the remaining payments.
CREDIT INSURANCE:
Credit insurance indemnifies the policyholder against loss resulting from the non-receipt of
payment in respect of a transaction approved by the credit insurer. Such transaction must
provide for the supply of goods or services on credit terms by the policyholder to a buyer.
The non-receipt of payment may be due to the buyer’s insolvency/liquidation or protracted
default or, where export transactions are involved, can also be due to repudiation or political
causes of loss. A simple example: A yarn manufacturer supplies his product to a textile-mill
on 45 days terms of credit. The credit insurer has insured the transaction. The textile-mill
goes insolvent. In terms of the credit insurance policy the credit insurer must pay the amount
owed to the yarn manufacturer who has as a result avoided a bad debt loss. (Protracted
default means non-receipt of payment after a specified period from due date. Repudiation
refers to the importer’s unlawful refusal to accept the goods/services supplied by the exporter.
Political causes of loss consist of : a) the refusal of the importing country to allow the
exported goods to enter unless such import prohibition already existed at date of export; b)
the inability of the importer to transfer the purchase price to the exporter due to the importing
country’s shortage of foreign currency or other regulation disallowing the transfer which
came into force after shipment of the goods; c) non-receipt of payment due to strike, civil
commotion, war or other similar disturbances.)
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CREDIT INSURANCE OF NATIONAL AND INTERNATIONAL IMPORTANCE:
The decisions made by a credit insurer influence the business of many parties. By granting
cover, credit transactions are made possible. By declining or withdrawing credit insurance
facilities, suppliers’ businesses are curtailed, and buyers’ businesses may be forced into
liquidation. The wrong decision by the credit insurer may lead to overtrading or loss of
business with the concomitant negative effects on the micro and macro economy. Many
export transactions would not take place without credit insurance. Credit insurance helps in
channeling limited resources towards worthwhile and healthy enterprises; it promotes the
earning of foreign exchange and thereby effects job creation. Internationally, credit insurance
is often used for political purposes. By underwriting major capital goods/services projects,
the economy of the importing country can be significantly influenced (e.g. Lesotho Highlands
Water Scheme or the Mozal aluminium smelter project in Mozambique). The withholding of
credit insurance facilities can be used to send a political message to the applying (importing)
country. Through its international associations, 39 credit insurers have a considerable
influence on international credit terms and conditions. Thus, the credit insurer’s activities
influence the national economy and can play an important role in international relations. The
credit insurer’s indemnity has not infrequently saved policyholders’ businesses which would
otherwise have been forced into insolvency due to major bad debts.
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1.2 Features/Characteristics (Insurance)
Credit Insurance policies have the following features which can affect cover:
Credit Limits – The amount the insurer is willing to pay for each buyer.
Reporting – Policies can require a number of different periodic reports from the insured.
Stop-Shipment – Policies require that shipments stop to a delinquent buyer.
Claims Filing – A timeline indicating when a claim should be filed.
Policy assignment – Proceeds of claims payments made payable to bank.
Credit procedures can be set to monitor compliance on these issues. Some suggested
methods and more detail on requirements follow.
• Credit Limits
Policies can have named-buyer limits, which indicate how much the policy will cover for a
particular buyer. A copy of the list of buyers and limits, or applicable policy endorsements
related to these buyer limits should be part of the bank’s information. When a company
demonstrates the ability to extend credit and has a successful track record of administering
good credit and collection procedures, a policy may be issued with a blanket or
“discretionary” limit. If the policy contains such a limit, buyers can be covered up to that
limit without being specifically named to the policy. The bank should determine what this
limit is, and what internal credit procedures the insured should be using. A broker can assist
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in identifying and interpreting the credit limit portions of the policy and accompanying
requirements.
A comparison of the outstanding amounts for each buyer in the A/R Aging against the
applicable credit limit can be readily done, once the matrix of credit limits is established.
• Reporting
Periodic reports are part of many policies. A broker can identify the reporting requirements
in the policy, due dates, and information content. Having the borrower provide a copy to the
bank is a good way to be sure the report has been filed. Some examples of reporting
requirements are:
Monthly reports of sales by buyer: Often premium payments must also accompany such
reports. Checks should be made against the actual sales (again, the current portion of the
aging will contain this information), to be sure all sales are reported as required.
Quarterly reports: These can include a) a gross sales amount (single number) for the quarter,
b) a receivables aging, c) a list of accounts and amounts more than 60 or 90 days past-due.
Policy compliance can be monitored by requiring that a copy of such reports be provided to
the bank.
• Stop-Shipments
Just as banks do not want to lend against seriously past-due receivables, insurers to not want
to insure additional sales to a seriously past-due buyer. Policies contain language that
indicates how many days past-due a buyer can be before shipments must stop. A broker can
help identify this language in the policy, and again, an aging of A/R by buyer can be
examined to assure that no further shipments have taken place to a seriously past-due buyer.
• Claims Filing Window
Policies have different claims procedures. One important element is when a claim should be
filed. There is often a first day the claim can be filed, there is usually also a final day that a
claim can be filed. In the event of a buyer default, the bank’s audit process should include
making sure that a claim is filed on time. A broker can assist in identifying the claims filing
requirements, and when a claim should be filed. Supporting documents like bills of lading,
invoices, and purchase orders are usually required to document the buyer obligation in the
event of a claim.
• Policy Assignment
Insurers are willing to pay the proceeds of a claim directly to a lender, as long as this is
approved in advance. The procedure for assigning the proceeds of a claim to the bank are
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usually fairly simple, and differ slightly, depending on the insurer. A broker can assist in
providing the appropriate forms and procedure for establishing an assignment of proceeds.
• Policy Compliance Checklist
Here is a checklist of policy compliance elements that can serve as a framework for
establishing the status of insured accounts receivable:
Credit Limits What are the named buyer limits? Is there a
blanket or discretionary limit? What is the
amount? Check Aging by buyer against limits
Reports When are reports due? What is the required
content or form? Did the borrower provide a
copy of the report as required?
Stop Shipments How many days past-due can a buyer be
before shipments must stop? Check aging by
buyer against this requirement
Claims Filing Window Are any buyers in default? What is the first
day to file a claim? What is the last day to file
a claim? Flag all buyers in default and check
against this window.
Policy Assignment Are the policy proceeds assigned to the
bank? Does the bank have a copy of the
document that establishes the assignment?
This information is designed to serve as a primer on the subject of Credit Insurance policy
compliance and monitoring and is not exhaustive. Each policy is different. A good first step
is to work with a qualified credit insurance broker who can review the unique requirements of
borrower’s policy.
Credit Insurance was born at the end of nineteenth century, but it was mostly developed in
Western Europe between the first and Second World Wars. Several companies were founded
in every country, some of them also managed the political risk to export on behalf of their
State.
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Credit Insurance is a term used to describe both Trade Credit Insurance and Credit Life
Insurance.
Credit Life Insurance is a consumer purchase, often sold with a big-ticket purchase such as an
automobile. 'The insurance will pay off the loan balance in the event of the death or the
disability of the borrower. Although purchased by the consumer/borrower, the benefit
payment goes to the company financing the purchase.
Trade Credit Insurance is purchased by corporations to insure their accounts receivable from
loss due to the insolvency of the debtors.
Over the '90s, a concentration of the Trade Credit Insurance market took place and three big
companies became the main players of a market focused on Western Europe:
• Euler Hermes, merger of the two credit insurance companies of the Allianz Group.
1.4 Advantages/Disadvantages/Benefits/Limitations
(https://www.onemainsolutions.com/products/credit-insurance)
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assesses the potential for both types of losses in the transaction before underwriting the
policy.
Credit insurance has long been a useful component in receivables finance transactions.
Although it has not historically played a major role, lenders have always been aware of its
existence and have sometimes made it a mandatory part of the total financial solution for
their client. The past two-to-three years has seen a shift, however. Credit insurance is now
As James Pedley, senior associate at global law firm Clifford Chance, comments: “Eight
years ago, credit insurance was hardly mentioned in securitization transactions, but it is now
At Hitachi Invoice Finance, Paul Hallett, senior business development manger, says: “Credit
insurance has definitely become an important feature in invoice discounting in the last two or
three years. When I entered the industry 20 years ago it was peripheral, whereas now it is
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much more talked about.” This trend is happening in Europe, especially in the UK and
Germany, and to a lesser extent in the US. The reasons are financial, political, and
accounting-based.
Richard Hawkins, CEO of Atlantic Risk Management, based in Chicago and London, argues
that credit insurers retrenched heavily in the aftermath of the banking crisis, more or less
withdrawing from the market; now they are seeking to make up for lost ground, lost clients,
and lost reputation. Sources in London’s global insurance market concur on this belief.
However, what is also happening is that credit insurers have become more innovative, more
client-facing, and more prepared to create products specifically for the receivables finance
market.
Meanwhile, the receivables finance market is itself developing, thus creating new
opportunities for credit insurers, to which they are responding. So, the greater use of credit
insurance is partly a result of the insurers marketing themselves more actively than in the
past, and partly because lenders and corporates are devising lending solutions that are more
Both lenders and borrowers are behind this increased usage of credit insurance in receivables
finance, but lenders appear to be the main drivers. According to Clive Pacey, formerly
working for an invoice discounter and now an independent asset finance broker (CPCM
Finance), lenders frequently want their client to be credit insured and if one of the client’s
debtors accounts for more than 20 per cent of their sales they may well insist on it. “I’m
seeing this a lot, especially if a debtor is overseas.” However, Hallett sees an increasing
interest in credit insurance coming from his new clients even before he mentions this as an
option. “More of my clients are requesting it,” he says. “If there is a heavy concentration of
debtors in the ledger then we will insist on credit insurance, but in all other cases the client
decides, and they increasingly say yes to credit insurance protecting them.”
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In the fiercely competitive market for invoice discounting credit insurance has become a
competitive weapon in its own right, according to Martyn Locke at international Lloyd’s
broker Cosmos Risk Solutions, many of whose clients are in Asia. He’s noticed invoice
finance companies in 2015 offering free credit insurance in order to secure new business,
though he has also seen invoice finance companies relax their requirement for credit
In Germany, factoring is almost wholly non-recourse, with credit insurance playing a major
part in the financial offering, as Klaus Dengler, a specialist in factoring and invoice
discounting at global insurer Aon’s Hamburg office, explains: “What is different today,” he
says, “compared with factoring two-to-three years ago, is that the competition for credit
insurance business has become intense. Prices are in free fall. Money has become so cheap
His colleague Silja-Leena Stawikowski, who specializes in trade finance political and special
risks, confirms this, adding that one of the biggest drivers for credit insurance in trade finance
this year is the need to insure against political risk. The number of countries where lenders
are concerned about political risk has risen markedly in the last three years, she says. German
companies are renowned for being very active exporters, and they are now doing so across a
wider spread of countries. Hence the importance of credit insurance for them.
A special factor in Germany is that a high percentage of its trade finance is funded by the
government-owned company, Hermes Bund. German exporters are eligible for this funding if
51 per cent or more of their products are made in Germany. However, as more German
companies buy in components from abroad, especially from Eastern Europe and Asia, they
are having to look beyond Hermes Bund for trade finance. This is having two effects: a)
many new trade finance companies are entering the German market and b) a host of new
credit insurance companies have set up in the country, including the subsidiaries of the big
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three global credit insurers, Atradius, Coface, and Euler Hermes. Both trends are resulting in
harsher price competition. The part that Aon is playing is in helping the insurers to write new
policies that reflect German business culture and German commercial law. The increased
willingness of credit insurers to tailor their policies to their clients – requiring trade or
At Aon’s global headquarters in London, executive director Steve Taylor has noticed a
significant increase in the use of credit insurance to support off-balance sheet receivables
explains, credit insurance is used to enable the off-balance sheet treatment to enhance the
rating of the portfolio, and to allow for a broader pool of receivables to be financed. As an
example, he says: “We have recently executed off-balance sheet transactions where a major
global bank was able to finance multiple locations, currencies, and concentration risks due to
One reason why this is happening more frequently is that the insurers are creating specific
products to make receivables finance much easier than it was two or three years ago.
discounting package by bringing the total value of the receivables covered up to 100 per cent,
instead of 70-80 per cent. The fact that insurers have created dedicated products just for top-
ups has helped the receivables finance community. Taylor comments that top-up and
syndication is a growth area for the credit insurance market. Everyone wins as clients
improve the overall coverage percentage, more finance can be provided, and insurers utilize
Credit insurance is being used more frequently to increase the eligible in non-recourse
factoring and in securitization, against which a bank might not otherwise have lent. So, in
those circumstances the banks are becoming more flexible, but so too are the insurers. That is
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largely due to the much greater insurance capacity that now exists globally, and as Richard
Hawkins points out, there is a lot of liquid capacity in global finance looking for an outlet.
Insurance is no exception, and the majority of credit insurers’ profits, as Steve Taylor points
The one area of receivables finance where credit insurance appears to have had the biggest
impact during the last two to three years is in receivables securitization. According to James
Pedley and Simeon Radcliff, partner at Clifford Chance, nearly all the receivables
securitizations that the law firm has handled since September 2014 have involved credit
insurance. Of course, as Radcliff is quick to add, that doesn’t automatically mean that such
deals are always going to require credit insurance, but its growing prevalence over the last
few years has been very noticeable. In a further rejoinder he says: “Many investors simply
won’t invest in financial instruments that are backed by trade receivables unless there is an
Again, as with factoring and invoice discounting, Pedley explains that one reason for the
greater use of credit insurance is that the insurers have designed policies specifically for
securitizations. So that itself makes credit insurance more available and more accessible for
He explains: “Whereas the old-style policies that would have been used to support a
securitization four or five years ago would refer to a company and its receivables, the newer
ones take into account the structure of the securitization, for example, specifically allowing
for an SPV (special purpose vehicle) to be paid in the case of a debtor defaulting. So, these
They have become important in securitizations, and according to Radcliff, if they are used
they are brought in right at the beginning of the negotiations. One of the major attractions to a
securitization investor of having credit insurance on board is that they are taking their
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primary risk not against the debtors but against the creditworthiness of the insurer, which will
be highly rated. Pedley confirms what many others have told that many banks will not lend to
certain companies unless credit insurance is in place. The credit insurers have seized upon
this development and are now marketing themselves much more to the corporates, saying that
they can help a company to raise additional finance if they take out credit insurance.
The fact that credit insurance can facilitate off-balance sheet treatment is another factor that
has raised its profile in all areas of receivables finance says Pedley, especially
securitizations’. In some instances, credit insurance means that for accounting purposes the
receivables no longer appear in the company’s accounts, because the entire risk has been
taken care of by an insurer. So that will often mean that the company’s debt-to-equity ratios
will improve, thereby easing compliance with financial covenants in other facilities. Radcliff
doesn’t of itself enable off-balance sheet treatment. However, having credit insurance is one
of the recognized ways to achieve it.” He adds: “You could argue that it’s window-dressing,
but in many cases, it is not. A company’s lenders may have attached covenants to their loans
stipulating that the company may not borrow against its receivables, unless it is a completely
true sale. So, in those instances the company has no choice but to do a credit insured
Having spent many years with Euler Hermes before joining Finacity, Charles Nahum repeats
the view that insurers have become more client-focused. The conditionality of policies has
changed a lot, he says, with insurers providing borrowers with more definitive assurance of
indemnification.
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A further factor, cited by Charles Nahum and everyone else trfnews talked to, especially in
the context of securitizations’, is political risk. Charles Nahum explains: “Securitizations’ are
increasingly going into new countries, many of which have a perceived political risk attached
to them. In those circumstances the banks will say we cannot progress with this unless we
have credit insurance.” Nahum has been arranging Finacity’s first securitization involving
With some large securitizations’, especially those covering debtors in emerging markets in
Asia and the Middle East, there can be as many as three credit insurers participating in the
deal, accompanied by lengthy negotiations involving every party. Nick Stainthorpe, at law
firm Reed Smith recalls one such example. A securitization that was being funded by a
continental bank could only be arranged on the understanding that credit insurers would be
underwriting the deal, and more crucially only after the bank had been assured that the
insurance cover would be transferred from the seller of the receivables (the company
requiring the securitization) to the purchasers via an SPV (special purpose vehicle). The
insurance policies of the different insurers had to be rewritten in order to accommodate all the
Stainthorpe adds that even though the debtors were generally creditworthy, the bank was
nevertheless unwilling to go ahead without credit insurance supporting it. Each of the credit
insurers had AAA ratings, giving the bank peace of mind and allowing the deal to proceed.
In the US also, credit insurance is used in cross border securitizations’, according to Michael
Brown in Reed Smith’s Chicago office. He says: “Frequently when I see global
securitizations’ involving a wide variety of countries I see credit insurance being used. It has
become very common.’ In the invoice discounting arena credit insurance is employed much
less, though he sees its use is increasing, especially with respect to the discounting of
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government obligor receivables. “It is increasing,” he says, “because a growing number of
Finally, research by trfnews suggests that one reason credit insurance is being used more in
trade and receivables finance is because the big accounting firms are showing corporates,
especially financial institutions, that one route to improving their working capital is through
use of the tool. Steve Taylor, at Aon, advises that, for corporates, as well as being a valuable
risk management solution, credit insurance is becoming a strategic tool for finance and
treasury, with the trend being for clients to explore how the use of the product can improve
For banks across their wider product lines, capital optimization and management of credit
concentrations are key drivers behind the increased use of credit insurance. These drivers
have supported the growth of single risk insurance for a number of years, and it is becoming
conditionality within their multi-debtor insurance policies so that they can obtain improved
capital relief.
Taylor argues that credit insurance is now making a more significant contribution to the
growth of receivables finance. It is ensuring that some deals are done that otherwise would
not be, it is facilitating higher borrowing limits, especially in factoring and discounting, and it
In a global world, where economic and, in particular, political risks have grown rather than
lessened over the last three years, credit insurance has been an important factor in the rapid
growth of receivables finance. Receivables finance would have grown without credit
insurance anyway, but its presence and widening product base has served to strengthen that
growth.
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1.6 Key challenges (Haddrill, 2008)
Trade credit insurers cover their clients against losses from trading with companies that go
bankrupt. In current circumstances this requires some difficult judgments. Insurers have a
duty to protect customers through the prompt payment of claims and by enabling them to
manage risks. They do not wish to stop covering trade with certain risky companies as that
withdraws protection from their clients. At the same time insurers must also at all costs
maintain their own financial health. Trade credit insurers have been managing this balancing
of risk with considerable care. Cover is never withdrawn retrospectively for contracts already
agreed. It is only stopped in respect of companies that have the highest risk of default when
strictly necessary. Behind any such decision is a detailed analysis and assessment of the
finances and credit-worthiness of a buyer. It would be madness for insurers to cover new
business with Ford or General Motors when every news programme in the US is speculating
about when those companies will go into Chapter 11 bankruptcy protection. If trade credit
insurers knew that a buyer was in difficulty, then they would be derelict in their duty if they
did not inform their customers of the risks. As a result of their prudence, trade credit insurers
remain in a sound financial position and are able to protect their existing clients while also
being able to take on new business. In 2007, trade credit insurers provided cover for 13,700
companies, a figure that has risen 40 per cent since 2004. This covers trade worth £282bn in
turnover. In the second quarter of 2008, the number of claims handled by trade credit insurers
grew by 31 per cent compared with the same quarter last year. They are prepared for an
increase in corporate insolvencies next year and are predicting a rise of 50 per cent.
That is consistent with the International Monetary Fund’s forecast of a 1.3 per cent shrinkage
in the UK economy. In providing such cover, trade credit insurers enable their clients to do
business with much greater security. Unlike most other types of insurance products, trade
credit insurance relies on the insurer constantly working with its customers to assess credit
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management risks. This partnership approach to insurance is unusual but necessary to ensure
This also means that the customer gets the benefit of the insurer’s professional assessment.
Trade credit insurers in effect underpin their clients’ trade and their borrowing from the
banks. When it is necessary to stop cover for future transactions with a particular trading
partner they are in effect providing risk management advice to their client about whom to
trade with, sending a signal about the need to diversify or to restructure the terms of the
transactions entered into by their customer. What they cannot do is support the companies
where risks have become uninsurable. They cannot stand in the place of banks that are
refusing to lend. Nor can they take on the kind of risk that the taxpayer can offer.
To do so would put their customers as a whole at risk. For those reasons we welcome the
reports in the Financial Times that Lord Mandelson, the business secretary, is considering
both the provision of guarantees against losses for companies trading in certain sectors and
steps to promote bank lending. Insurance is only one source of help for businesses. It is
absolutely vital that companies have access to finance to allow them to keep trading during
this difficult time. Insurers themselves do not need such support but they can help Lord
Mandelson in his work. The Association of British Insurers has therefore written to him
proposing that a forum be established involving his department, the insurance sector and
others to work together to address these issues. This can contribute to ensuring that any action
by the government can be as effective and precisely targeted as possible. In this way the
expertise of the private sector combined with the muscle of government can be deployed to
ensure that more businesses can chart a safer course through the coming months
Credit insurance is a financial tool that offers tremendous competitive advantages for asset-
based lenders who understand how to use it. If you haven’t heard of it before, or if you think
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you may have heard all there is to hear about it, following are a few new approaches you may
not have considered.
In a competitive environment, or in situations where you are simply searching for ways to
meet your client’s increasing capital requirements, we have found credit insurance
consistently provides the optimum solution to safely putting more capital in the client’s
hands. Maximizing capital availability will win you the deal every time. The real trick is
doing this without compromising your internal credit underwriting guidelines. In all the
competitive situations we have encountered, the lender who used credit insurance to increase
availability ultimately offered the client a more attractive program and won the deal.
As a firm that specializes in all forms of domestic and export credit insurance and political
risk insurance, we help lenders use these programs to solve several very specific risk issues
when structuring receivables-based borrowing arrangements for their clients. In addition to
the obvious basic credit risk mitigation benefits the policy offers, credit insurance also
provides an added layer of expert due diligence and on-going monitoring of covered accounts
to further strengthen the client’s credit practice and protect the lender’s interests. Many of the
carriers also provide collections and bankruptcy litigation support at rates lower than the
typical cost.
Even if you are comfortable with the risk profile of a client’s customer base, there are still a
few deals breaking issues that can impact a transaction. Here’s how you can use credit
insurance to resolve them:
• Overdue Ineligibles
In many industries, like automotive or project-oriented business sectors, it is not uncommon
for a fair percentage of total accounts to fall beyond the standard 60 or 90-day eligible
window. This may result in a reduction of available working capital of 20% to 40% or more.
Receivables that extend beyond the window are not included in the borrowing base, and the
client loses access to the capital tied up in these accounts.
Credit insurance can be structured to protect accounts from protracted default (past due)
problems up to 180 days from invoice date. This protection allows lenders to keep accounts
in the borrowing base for a much longer period of time, with obvious benefit to the client.
Should the covered accounts ultimately default, the carrier will reimburse the loss according
to the terms of the policy.
• Purchase Order Protection
20
Most lenders have difficulty providing advances against purchase orders. While credit
insurance does not address any performance issues you may have with your client, assuming
you are confident in their ability to do their work and deliver, credit insurance can provide
protection to advance against the initial contract. We have met several companies operating
well below capacity and turning away orders because they lacked the capital to fund the jobs
upfront.
Credit insurance can be structured to protect the client and lender against default by a
customer on a custom prepared product or service even before the work is complete and the
customer invoiced. This purchase order protection is an ideal way to hedge the risk of taking
a loss on an account that has not yet been converted into a receivable. It also provides your
client with capital right when they need it most- when they get a new contract.
• Advance Rate Increases
Because of the potential for bad debt losses possible in any given account portfolio, advance
rates are limited. We regularly use credit insurance to protect lenders who wish to increase
their advance rates. As an example, a policy with a simple 10% coinsurance, where the
carrier agrees to pay .90 on the dollar for all eligible losses, enables the lender to increase the
advance rate to 90% and still be covered for their full exposure. The client retains 10% of the
risk, and the carrier absorbs the remaining 90%. Considering that the typical advance rates in
a good deal average just 80%, the extra available capital from even a 10% advance rate
increase can be substantial. Credit insurance can allow advance rate increases that make a
marginal deal good and a good deal great, in the client’s eyes.
• Cost of Funds
The natural reaction when considering credit insurance is that it will add another cost burden
to a deal where price is always a key issue. What we have found is that for a cost averaging
just 10 to 30 basis points on covered annual sales, the premium for credit insurance does not
add measurably to the cost of the transaction. Further, the rates required for the lender to
properly price for the risk is greater than the policy premium and lower cost of funds possible
with the coverage. In several instances, we have structured policies for lenders competing
against non-credit insured offers. The program utilizing credit insurance provided greater
eligible and advance rates resulting in more capital, and the lender’s cost of funds did not
have to include a premium for the credit risk, so the total cost, even with the policy, was
lower. This makes for an easy decision on the client’s part.
21
A slight basis point reduction in the cost of funds will more than offset the policy premium,
and as the receivables turn and the portfolio is leveraged multiple times during the year, the
cost of credit insurance is spread extremely thin. The client’s return on the additional funds
employed, provides a substantial return on the premium investment.
With the right policy structure behind your deal, you can bring tremendous value to your
clients, while increasing your loan portfolio and reducing your exposure to potential losses.
• Issue relating to the concept of credit insurance
Trade credit insurance, business credit insurance, export credit insurance, or credit
insurance is an insurance policy and a risk management product offered by private insurance
companies and governmental export credit agencies to business entities wishing to protect
their accounts receivable from loss due to credit risks such as
protracted default, insolvency or bankruptcy.
• Other issues
There are many other issues relating to the credit insurance such as, issue related to policy
premium, claims rejected for 'non-disclosure', issue relating to claim settlement.
This Black Book is all about Credit Insurance and it is majorly divided into 6 Chapters that is
given below:
22
1. Introduction
2. Review of literature
3. Research methodology
4. Data analysis
5. Summary of findings
6. Suggestion and Conclusion
1. Introduction chapter contains all information related with the Credit Insurance
• What is Credit Insurance?
• How is works?
• Various activities
• History of Credit Insurance
• Origin
• Feature, Advantages, Disadvantages, Benefits
• Recent trends and growing importance
• Key challenges, Problems, Objectives
23
5. Summary of findings is related with the report on finding after the data analysis.
6. Suggestion and Conclusion chapter is all about, what are the suggestions after research
and conclusion of student.
7. Bibliography
24
2 Chapter 2: Review of literature
2.1
(Bhattacharya, 2008) Credit insurers are heavily depending on open account transactions in
the business-to-business market. An open account transaction is a sale where goods or
services are delivered before payment is due. “Open account is as old as commerce”.
1. Do you think that Credit Insurance are depending on open account transactions?
2.2
(Biaus & Gollier, 1997) The question here is why buyers use trade credit as a fund of
finance instead of bank loans. Financial theories suggest that suppliers have a benefit
against lenders in financing the buyer also known as the borrower. Suppliers should have
access to more inside information than a regular lender.
2. Do you agree that supplier should have adequate financial information of borrower?
Highly Agree Agree Can’t say Disagree Highly Disagree
2.3
(Van Der Veer, 2010) A credit insurance policy covers the risks of payment after the
delivery of goods and services. The traditional short-term credit insurers also known as
the big three in the credit insurance market usually cover a whole portfolio of debtors.
Atradius, Coface and Euler Hermes covers 87 percent of the world market in 2010.
3. Do you agree that sometimes seller sells goods which exactly doesn’t satisfy borrower
requirement?
25
2.4
(Petersen & Rajan, 1997) Trade credit can also be used as a substitute of bank loans in
case that the bank does not provide the necessary loan. A research in loans issued by
financial firms disclosed that firms, with a longer relationship with a financial firm,
depends less on trade credit. Firms who are internationally active also deliver goods or
services in their own domestic markets. Firms who do international business have
additional risks like country risks. They can cover these risks with a credit insurance
policy. Not one firm is immune for trade credit risk. This brings me to describe rise of
export credit insurance.
4. Do you think that longer relationship with a financial firm result in less dependency on trade
credit insurance?
2.5
2.6
(Morel, 2010) In the time when the credit crisis is at its peak due to the fall of the
Lehman Brothers in September 2008 the ECA has a stable risk adoption. The short-term
coverage decreases as the private credit insurers cut the credit limits. In the table you can
see an increase in the percentage by the ECAs in the short-term exposure in 2009 and
2010. During the highest peak of the credit crisis the ECAs are taking credit risk exposure
so that the commercial banks financed the exporters. Insurance coverage was a
requirement to obtain a loan from a bank.
26
6. Do you agree Credit Insurance is a must in Crisis period?
2.7
2.8
Abraham and Dewit (2000) demonstrate that government guarantees can stimulate firms
to export even without subsidization by charging a fair premium. Thus, the rationale for
the trade-promoting effect of export credit insurance seems to apply as well to private
insurers, who are unlikely to subsidize their clients.
8. Do you think Government should subsidize Credit Insurance?
Highly yes Yes Can’t say No Highly No
2.9
(Becue, 2009, p. 91) By providing insurance cover, public and private credit insurers
reduce the costs of insecurity and information related to the entry in foreign markets,
allowing their clients to learn about the creditworthiness of their trade partners (buyers).
Subsequently, after repeated transactions, the client may decide to export without costly
export credit insurance. A multiplier effect of private credit insurance could, however,
also follow from the information on foreign markets and firms that private insurers
provide to non-insured firms. First, a private credit insurer’s policy stance vis-a-vis a
particular firm (buyer) or country could have a "signaling effect", influencing the export
decision of non-insured firms. Indeed, the news of an adjustment of a firm rating or credit
27
limit -the maximum exposure of the insurer in respect of a buyer-tends to travel fast
among all suppliers of the particular firm, potentially influencing all trade transactions of
the firm.
9. Do you think Credit Insurance reduces the cost of insecurity?
Highly yes Yes Can’t say No Highly No
2.10
Rekha Arunkumar and Koteshwar (2010) feel that the Credit Risk is the oldest and biggest
risk that Banks, by virtue of their very nature of business inherit. The pre-dominance of credit
risk is the main component in the capital allocation. As per their estimate credit risk takes the
major part of the Risk Management apparatus accounting for over 70 per cent of all Risks. As
per them the Market Risk and Operational Risk are important, but more attention needs to be
10. Is it the bad debts or credit losses are the factors that have driving the robust growth of
credit risk insurance in India?
Highly yes Yes Can’t say No Highly No
28
1 Chapter 3: Research methodology
This Chapter concentrates on the research methodology. The research design, sampling
design, data collection method, tools applied for the study geographical coverage and
The research design is defined by Fouche (2002) as “the plan or blue print of the study”. This
research is Qualitative research which allows the researcher to gather information and do an
in-depth exploration of issues, and therefore follows a less structured format with fewer
The study is an empirical one based on sample survey method. Sample was conducted
among two branches along Urban Mumbai. 2 Senior employees of LIC were selected as
sample respondent for the study. The required Open-Ended data were collected by means of
an interview schedule.
The study is an empirical one based on sample survey method. The study has basically
depended on primary data. The required primary data were collected by means of an
Questionnaire administered to customers of Insurance Company. Secondary data were
collected from books, websites, journal and periodicals . Total target population is 40
respondents.
29
1.2.2 Sampling frame
Quota sampling was adopted by researcher. Quota sampling is where the researcher ensures
that certain groups of people, who are knowledgeable about the research problems, are
adequately represented in the research through the assignment of a fixed quota for each sub
group.
The period of study was from January to March 2018. The study is mainly based on primary
data collected by questionnaire made on the findings of various researchers. The secondary
data were collected from various sources throughout the period of this study.
10 Questions each from 40 respondents were collected from Customers totaling to 400
samples
This section discusses the techniques of gathering primary data for the testing of the research
propositions that were crafted in Chapter I and II. The choice of the data instruments depends
on the availability of facilities, time, costs, the degree of accuracy required, the expertise of
the researcher, and other resources associated with the gathering of the data.
The questionnaire was given to the respondent directly by the reserchers and was collected
The structured questionnaire was divided into different sections as felt suitable. The first
section covers personal variables, which are independent based on the assumption that there
were measurable differences amount the levels with regard to the perception of dependent
30
variables. The second to study factors section of questionnaire covers the factors of study
1. Do you think that Credit Insurance are depending on open account transactions?
2. Do you agree that supplier should have adequate financial information of borrower?
Highly yes Yes Can’t say No Highly No
3. Do you agree that sometimes seller sells goods which exactly doesn’t satisfy borrower
requirement?
4. Do you think that longer relationship with a financial firm result in less dependency on trade
credit insurance?
5. Do you think Government policy plays a vital role for deciding to have Credit Insurance?
7. Do you agree that Credit Insurance helps a firm to reduce its profit uncertainty in foreign
market?
10. Is it the bad debts or credit losses are the factors that have driving the robust growth of
credit risk insurance in India?
Highly yes Yes Can’t say No Highly No
NAME:
DEZIGNATION
ORGANIZATION
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
Q.3 What is your opinion about the claim settlement policy of credit insurance?
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
Q.4 What are the marketing techniques adopted by your agency to promote credit
insurance in India?
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
33
1.8 Analytical Tools applied for the study
Data analysis gives meaning to the data that has been collected. More than 40 respondents
samples were finalized. The data corresponding to the values in the Likert Scale were entered
for each statement in the questionnaire. It was then checked for accuracy, through three
rounds of visual and hardcopy inspections. The MS Excel data analysis tool was used for
The Average score analysis is mainly used in any study is to assess the level of
relating to the study. First the opinion of the respondents is assessed through a scaling
technique and then based on the consolidated opinion of the respondents, the average score is
calculated.
It is the simple and common method to represent raw streams of data as a percentage for
better understanding of collected data. Percentages are used in making comparison between
Research ethics refer to the "appropriate" behavior of the researcher in relation to the norms
of the society. It relates to the three parties involved in this research: the researcher, the
34
respondents and Research supervisor. Researcher assured Confidentiality to the respondents
Here,
And
35
N: Neutral / Can’t say
D: Disagree / No
HD: Highly Disagree / Highly No
The average score analysis is mainly used in any study is to assess the level of opinion /
awareness / satisfaction of the different category of respondent on the various aspects relating
to the study. First the opinion of the respondents is assessed through a scaling technique and
then based on the consolidated opinion of the respondents, the average score is calculated.
In this study the opinion of the respondents are assessed through a five-point scaling
technique similar to Likert scaling and then based on the consolidated opinion of respondents
the average score is calculated and the results are presented in different tables with suitable
interpretations. In this section the average score of analysis is performed for the study
variables: -
• Testing of Hypothesis
Null Hypothesis (H0): Gender of the respondent does not influence their perception as to
Credit Insurance.
Alternative Hypothesis (H1): Gender of the respondent does influence their perception as to
Credit Insurance.
The above testing of hypothesis can be done using the following table-
Table 4.1. 1
V1 12 22 6 0 0 40
V2 10 22 7 1 0 40
V3 2 21 11 6 0 40
V4 1 13 16 10 0 40
V5 1 9 12 16 2 40
V6 2 27 11 0 0 40
36
V7 4 25 9 2 0 40
V8 5 27 6 2 0 40
V9 9 16 6 8 1 40
V10 8 25 5 2 0 40
(Source: Primary data)
Table 4.1. 1
Table 4.1. 2
37
V6 1 3 3.75 5 Medium - Medium
V7 1 3 3.75 5 Medium - Medium
V8 1 3 3.75 5 - -
V9 1 3 3.75 5 Medium LOW Medium Medium
V10 1 3 3.75 5 Medium - Medium Medium
(Source: Primary data)
38
2.2 Percentage analysis
The percentage analysis/ descriptive analysis describes the distribution of respondents in each
classification as it is expressed in percentage it facilitates comparison.
Table 4.2. 1
39
• With reference to variable V4, it is found that 33% of the respondents agreed that longer
relationship with a financial firm result in less dependency on trade credit insurance
and 40% of the respondent have neutral response and 25% of the respondents are
disagreed to it.
• With reference to variable V5, it is found that 23% of the respondents agreed that the
Government policy plays a vital role for deciding to have Credit Insurance and 40% of
the respondent have disagreed to the statement and 30% of the respondent have neutral
response.
• With reference to variable V6, it is found that 68% of the respondents agreed that Credit
Insurance is a must in Crisis period and 5% of the respondent are highly agree to it and
28% of the respondent have neutral response.
• With reference to variable V7, it is found that 63% of the respondents agreed that Credit
Insurance helps a firm to reduce its profit uncertainty in foreign market and 10% of
the respondent are highly agree to it and 23% of the respondents have neutral response
and 5% of the respondents are disagreed to it.
• With reference to variable V8, it is found that 68% of the respondents agreed that
Government should subsidize Credit Insurance and 5% of the respondents are disagreed
to it and 15% have neutral response.
• With reference to variable V9, it is found that 23% of the respondents are highly agreed
that Credit Insurance reduces the cost of insecurity and 20% of the respondents are
disagreed to it.
• With reference to variable V10, it is found that 63% of the respondents agreed that the
bad debts or credit losses are the factors that have driving the robust growth of credit risk
insurance in India and 13% of the respondents have neutral response.
40
2.3 Gender wise percentage analysis
41
Table 4.3. 2
• From variable V2, we can find that females feel that the supplier should have adequate
financial information of borrower, more than males.
• From variable V3, we can find that males feel that sometimes seller sells goods which
exactly doesn’t satisfy borrower requirement, more than female.
• From variable V4, we can find that females feel that longer relationship with a financial
firm result in less dependency on trade credit insurance, more than males.
• From variable V5, we can find that females feel that not only the Government policy
plays a vital role for deciding to have Credit Insurance, but more than males.
• From variable V6, we can find that males feel that Credit Insurance is a must in Crisis
period, more than females.
42
• From variable V7, we can find that males feel that Credit Insurance helps a firm to
reduce its profit uncertainty in foreign market, more than females.
• From variable V8, we can find that males feel that Government should subsidize Credit
Insurance, more than females.
• From variable V9, we can find that males feel that the Credit Insurance reduces the cost
of insecurity, more than females.
• From variable V10, we can find that males feel that the it is the bad debts or credit losses
that robust growth of credit risk insurance in India more than females.
Sample Variance
Maximum
Minimum
Skewness
Kurtosis
Median
Range
Count
Mode
Mean
Sum
V1
16
4.1 0.4 4 1 5 40
(0.64) (0.17) 6 0.21
5 4 4 0.66 4
V2
16
4.0 0.5 0.23 4 1 5 40
(0.45) 1 0.23
3 4 4 0.73 4
V3
13
3.4 0.6 4 1 5 40
(0.46) (0.51) 9 0.25
8 4 4 0.82 7
V4 3 3 4 1 5 12 40
3.1 0.82 0.6 (0.89) 0.05 5 0.25
43
3 8
V5
11
2.7 0.9 4 1 5 40
(0.63) 0.29 1 0.29
8 3 2 0.95 0
V6
15
3.7 0.2 4 1 5 40
(0.02) (0.21) 1 0.16
8 4 4 0.53 8
V7
15
3.7 0.4 0.82 4 1 5 40
(0.62) 1 0.22
8 4 4 0.70 9
V8
15
3.8 0.4 1.64 4 1 5 40
(0.84) 5 0.21
8 4 4 0.69 7
V9
14
3.6 1.2 4 1 5 40
(0.77) (0.49) 4 0.35
0 4 4 1.13 7
V10
15
3.9 0.5 1.28 4 1 5 40
(0.78) 9 0.23
8 4 4 0.73 4
(Source: Primary data)
• V1: Do you think that Credit Insurance are depending on open account transactions?
44
Pie 4.5. 1
From the findings we can summarize that 55% responses are agree and 30% responses are
highly agree.
• V2: Do you agree that supplier should have adequate financial information of borrower?
Pie 4.5. 2
From the findings we can summarize that 55% responses are agree and 25% responses are
highly agree.
• V3: Do you agree that sometimes seller sells goods which exactly doesn’t satisfy borrower requirement?
45
Pie 4.5. 3
From the findings we can summarize that 52% responses are agree and 15% responses are
disagree.
• V4: Do you think that longer relationship with a financial firm result in less
dependency on trade credit insurance?
Pie 4.5. 4
From the findings we can summarize that 33% responses are agree and 25% responses are
disagree.
• V5: Do you think Government policy plays a vital role for deciding to have Credit Insurance ?
46
Pie 4.5. 5
From the findings we can summarize that 23% responses are agree and 40% responses are
disagree.
• V6: Do you agree Credit Insurance is a must in Crisis period?
Pie 4.5. 6
From the findings we can summarize that 67% responses are agree and 5% responses are
highly agree.
• V7: Do you agree that Credit Insurance helps a firm to reduce its profit uncertainty in
foreign market?
47
Pie 4.5. 7
From the findings we can summarize that 62% responses are agree and 5% responses are
disagree.
• V8: Do you think Government should subsidize Credit Insurance?
Pie 4.5. 8
From the findings we can summarize that 68% responses are agree and 5% responses are
disagree.
48
Pie 4.5. 9
From the findings we can summarize that 40% responses are agree and 20% responses are
disagree.
• V10: Is it the bad debts or credit losses are the factors that have driving the robust growth
of credit risk insurance in India?
Pie 4.5. 10
From the findings we can summarize that 62% responses are agree and 5% responses are
disagree.
49
3 Chapter 5: Summary of findings
50
• Claims rejected for 'non-disclosure'
Many such claims get rejected because of the non-disclosure. It is very important to disclose
all the facts relating to the policy by the policy holders.
• Valuations
The valuation of the proper premium or nominal premium is very important, and every
insurance company should have proper calculation or valuation of premium.
• Problems at renewal
The policyholder faces the problem while renewing the policy. It should have proper renewal
of policy. But from the finding we can summarize that the difficulties are overcoming as the
company makes proper policies for the renewal.
51
4 Chapter 6: Suggestions and conclusion
CONCLUSION:
From this we can conclude the credit insurance is important and essential and it is beneficial
for the businessmen. Therefore, separate regulatory mechanisms to tackle the documentary
credit dispute need to be developed. The Reserve Bank of India should oversee the working
of self-regulatory agencies. It should also monitor the documentary credit transactions. It is
expected that by implementing these measures the law governing documentary credits in
India could be made in tune with the international standards which will enable Indian banks
to meet the global challenges .Credit Insurance is one of the new type of insurance that is
very important and providing benefits to businessmen whose business runs on the credit who
have their transactions mainly on credit basis. Trade is the engine of the global economy. It
allows companies to grow, compete and improve on their products. Trade creates jobs and
investments. It increases income levels and reduces poverty. Whether an economy is
developing or not, or if it is small or large, trade is of vital importance. Without trade, growth
is not possible. Trade allows micro-enterprises to grow into small and medium enterprises
and beyond. Trade credit insurance is a product designed to assist traders in addressing these
and many other concerns. Trade credit insurance offers protection from financial loss when
receivables remain unpaid. It is an insurance product, but also much more than that.
Ultimately, should an unexpected loss occur, the trade credit insurance policy provides
indemnification, thus protecting the policyholder’s revenue and bottom line. By maintaining
a strong relationship between the insurer and the credit management department, trade credit
53
insurance may be the wisest investment a company can make to ensure its profits, cash flow,
and capital are protected.
Based on the study on the testing of hypothesis conclude that gender significantly influence
all different variables.
5 Bibliography
growing-use-of-credit-insurance-in-receivables-finance-1-1.pdf.
insurance/.
b73a-11dd-8e01-0000779fd18c.
https://www.onemainsolutions.com/products/credit-insurance. (n.d.).
enhancements-for-asset-based-lending/.
content/uploads/2016/03/An_Introduction_to_Credit_Insurance.pdf.
id=Op2BAwAAQBAJ&pg=PT85&lpg=PT85&dq=Trade+credit+insurance+was+b
orn+at+the+end+of+nineteenth+century,
+but+it+was+mostly+developed+in+Western+Europe+between+the+First+and+S
Google Books.
54