Establishing credit limits

You may be able to establish your own credit limits if your policy contains a discretionary credit limit. This discretionary limit is the maximum credit that you can approve for a customer without requesting a credit approval from the insurer. For details of how to do this, consult the discretionary credit limit section of your Coverage Certificate.

Applying for a credit approval or a credit limit increase can be done via our credit insurance platform. When we receive the request, we will do one of the following:

• Approve the credit limit for the customer and issue a credit approval
• Decline the credit limit and not issue a credit approval
• Request additional information from you before making a decision

You may receive a response immediately when submitting your request, or we may need a few days for our due diligence. If there is not enough information for us to make a decision, we will contact you to discuss ways to resolve the issue.

In most cases, a credit approval is in effect for as long as you continue to sell to the customer, unless we change or cancel the credit approval. We will inform you of any such change. In other cases, we may issue a temporary credit approval which will expire on a specified date.

Declined credit requests

We may decline your credit request if the credit risk is deemed excessive or if we do not receive the additional information required to make a credit decision. You will be notified if we decline a request for coverage.

If you wish to undertake the credit risk by yourself and sell to the customer on an uninsured basis, you are free to do so. If you choose this option, however, you should also consider doing one of the following:

• Ask for full payment in advance. While this may not be ideal for the customer, you cannot be expected to finance their purchase.
• lnsist on security. Obtain an irrevocable letter of credit or a bank guarantee to transfer the risk from your customer to a bank, which is generally a better risk.
• Request another party, such as a stronger parent company, to guarantee payment. In this case, your underwriter would need to assess the creditworthiness of the guarantor.

Reviewing your credit approvals

A list of your active credit approvals is available via the credit insurance platform. It is important that you regularly review these approvals and advise us of any necessary changes.