Tel.: +420 261 097 575
Fax: +420 241 409 522
About Credit Insurance
Why credit insurance?
- One of the most significant risks in business is the risk of a receivable not being paid.
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Credit insurance is insurance for the risk of non-payment of receivables, which are due from Czech or foreign buyers as a result of their insolvency or protracted default (commercial risks), or as a result of territorial risks (political risks) on the part of a foreign buyer.
- Commercial risk = insolvency or protracted default of a buyer
- Political risk – non-payment as a result of a political event or economic problems in a country
- The goal of credit insurance is to secure the non-payment risk (business risk) in relations between business entities.
- Credit insurance is one of the most reliable ways to protect against irrecoverable receivables.
- The insurance company helps to choose appropriate business partners and recover any unpaid receivables.
KUPEG's products are:
Simple
INSURANCE POLICIES ARE VERY EASY TO ARRANGE
- Online, via e-mail, over the telephone or by post
ADMINISTRATION IS NOT DIFFICULT
- 90% of the paperwork can be done online
NO UNECESSARY BURDEN ON CLIENTS
- Clients must apply for limits, report their receivables claims in time, and send notification of an insurance claim threat in time (and, of course, pay the premiums on time)
EASE OF COMMUNICATION
- Communication channels through a sales person, risk analyst (underwriter) and claim specialist are always open and available to you
PERMANENT ASSISTANCE
- All KUPEG employees are prepared to help you at all times
Quick
TAKING OUT AN INSURANCE POLICY
- Policies may be taken out within 14 days, at which time clients are immediately granted access to the online insurance administration site, where they can easily and conveniently take care of any operations related to the insurance.
CREDIT LIMIT
- The credit limit is normally confirmed for the buyer within two days (within the Czech Republic).
SETTLEMENT OF INSURANCE CLAIMS
- Settlements are performed without undue delay and disbursements made within 45 days after delivery of the required documents (where insolvency has been proven)
Discreet
The insurance remains in the background of the relationship between the client and the buyer, and the insurance company does not interfere with that relationship in any manner (with the exception of contact with the buyer being agreed in advance with the client or when the buyer has not paid).
Affordable
The price of the insurance is a fraction of a percent of the invoiced amount, whereas the possible indemnity may be as high as the invoiced amount (minus the deductible).
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Example:
- Invoice = CZK 100,000
- Premium Rate = 0,45%
- Deductible = 20%
- Insurance Premium = 450 Kč
- Indemnity = 80 000 Kč
= disbursement of up to CZK 80,000 for a CZK 450 premium
Effective
- The primary purpose of credit insurance is protection against problems caused by the buyer’s non-payment for goods or services.
- If a company’s key buyer goes bankrupt, the insurance company stands by the company and provides it with indemnity to prevent a loss that could be fatal.
- The following chart simply illustrates the impact of non-payment on an uninsured company and on an insured company.
- In turbulent economic times, as we are currently experiencing, insurance can be the difference between your company staying afloat or going out of business.
| Percentage of unpaid receivables | 0% | 1% | 5% | 10% |
| Turnover in CZK | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 |
| Margin in CZK (6%) | 6,000,000 | 6,000,000 | 6,000,000 | 6,000,000 |
| Fixed Costs in CZK | -2,000,000 | -2,000,000 | -2,000,000 | -2,000,000 |
| Insurance Premiums in CZK (0,5%) | -500,000 | -500,000 | -500,000 | -500,000 |
| Write-off of Receivables in CZK | 0 | -1,000,000 | -5,000,000 | -10,000,000 |
| Final outcome without Insurance in CZK | 4,000,000 | 3,000,000 | -1,000,000 | -6,000,000 |
| Indemnity in CZK (85%) | 0 | 850,000 | 4,250,000 | 8,500,000 |
| Final outcome with Insurance in CZK | 3,500,000 | 3,350,000 | 2,750,000 | 2,000,000 |
Multi-Purpose
With the possible indemnity, insurance primarily functions as protection against financial losses with defined limits. It works as:
- A recommendation of the maximum volume of open receivables to be paid by a particular buyer (based on a comprehensive analysis of the buyer’s creditworthiness)
- A timely warning of problems – the insurance company performs continuous monitoring of the buyer’s financial and payment situation
For handling claims and collection of debts, it effectively and professionally assists the client in the process of judicial and out-of-court recovery
Why KUPEG?
We are:
- The biggest and most experienced company on the market for domestic risk insurance
- A strong company with capital backing from the well-established international group, ONDD (the group‘s leading company, which is rated “AA” by Standard & Poor‘s)
- A specialist in insurance for exotic markets
- Prepared to fully respect your company’s credit and risk management
- A company that concentrates on building long-term business relationships with an individual approach
Our Products
- Provide comprehensive coverage for both commercial and political risks
- Designed to adequately cover receivables of all clients, irrespective of their size, legal status or amount of turnover
- Allow full management of the insurance via our online application, e-ONLINE, which is available 24/7
