How to have a smoother renewal process

Gordon Kidd, Senior Manager, Corporate Relationships

 

Getting the right information so we understand a customer's business and risk is the main goal at renewal. Significant numbers of Atradius’ customers do not provide the complete information needed which may leave them exposed to unnecessary risks. Here are some top tips for getting your renewal process right the first time.

1. Be prepared

Atradius issues a renewal notice three months before your credit insurance policy expires, allowing plenty of time for you to review and provide updated information for the upcoming 12 months’ coverage.

2. Update your business data

A year is a long time in business and even the smallest change can affect your credit insurance policy. For example, if your company has introduced a new product, purchased a new company or changed the way you operate your business, you will need to inform Atradius.

It is advisable to get in touch with your Atradius account manager or broker throughout the year with any changes to your company or cover. This will save time when it comes to renewing your policy and ensure you have the correct cover over the year.

3. Re-assess your appetite for risks

Each year, you need to think about the current structure of your policy and whether it’s still appropriate for your business.

You can influence your credit insurance premiums by changing the share of risk i.e. the amount you will bear in the event of a claim. If a customer is comfortable with the risk their debtor book presents, they may want to pay a reduced premium. It is best to contact your Atradius account manager or broker to discuss the right structure for your business.

4. Provide risk information

To review a customer’s risk at renewal time we need:

• To review your company’s credit limits listing with you to identify which limits need to be higher, lower or can be cancelled. This can reduce the costs of credit limits.
• As the financial health of a debtor may have changed over time, credit limits which were not fully approved or refused 12 months ago will be reviewed at renewal.
• Your company’s Aged Trial Balance – this is a picture of the spread of risk your debtors present and helps with identifying the most appropriate structure for your policy. It also helps to identify trends or changes to payment behaviour.
• Something we like to obtain from our customers but not requested on our renewal notice is an up-to-date copy of their credit management procedures. This allows Atradius to understand how our customers vet debtors for credit terms, how they monitor their exposures, when they place accounts on stop and how they chase up overdue debts. This can positively affect renewal premiums. It also can help in getting a credit limit application on a marginal debtor across the line when we can appreciate our customer’s controls on that account.

5. Get it in on time

Finally, and most importantly, get it in on time. Unless Atradius agrees to hold cover or extend the policy for a month, if you don’t renew the policy before the expiry date, you’re not covered, exposing your business to unnecessary risks.