Many businesses could benefit from it, with some simply finding it easier and more profitable to have it on hand, and others finding that they could very easily go out of business without it. But what is credit insurance, and do you really need it?
If your business is one that gives out goods or performs services with an invoice to be paid upon receipt, then it is likely to need some kind of trade insurance. After all, the majority of people offering services are unlikely to be able to charge upfront as those receiving the service will want to make sure that the work is carried out to a certain standard before they part with money.
However, once you have performed services or sent goods to a party, if they do not pay, you could find yourself facing serious problems. Whether cash flow is affected or whether you become unable to continue trading due to such a reduction in finance or resources, by getting credit protection insurance not only will you have someone on hand to help you get back the money you are owed in the most effective manner, but should that money never materialise, the insurance company in question will cover the debt for you, allowing you to carry on trading without problems.
So, do you need it?
If the goods or services you offer are minimal in value, then they may not be much need for you to have such insurance as losing a tiny bit of money here or there may not make a big difference. However, if any failure to pay by any customer could cause you problems, such insurance will be integral.
