ICBA Switzerland

Our client is from the commodity trading sector – non-ferrous metals with an annual insured turnover circa: $300 million. There is fierce competition in their sector. Whilst having good contacts and networking with the right people are important factors in driving sales, their pricing and contractual conditions are crucial. With their company, as is routine with the other companies in their sector, margins are small. This means that buyers expect a lower price or longer payment terms from the outset. If they can’t offer these they will lose the contract.

Although they already had Trade Credit Insurance in place,  their Policy limits were insufficient. So they were close to losing some contracts with long term Partners. They approached us and asked if we could help them achieve the necessary limits to ensure this did not happen.

We were confident that as soon we were given a mandate, we would be able to improve their current Policy conditions and improve their limits which were crucial to retaining business. We started out by clarifying with their current Insurer if we could improve on anything. Whilst with some buyers we could secure improvements, they were insufficient even with their in-house Top-Up solution.

We had to look for solutions in other markets.

It was challenging to find these limits in the conventional market. We found what we were looking for from a Lloyds-backed Insurer specializing in top-up solutions for third-party Insurers.

We were able to help this client because of our strong relationships with Underwriters. As an aside, we always ask our clients to contact us first with any question or concern as opposed to going directly to the Underwriter. We have the experience to determine if there is an issue and if there is, how it should be forwarded to the Insurer. Experience shows that many policyholders tend to exaggerate the situation, which then leads to fractious discussions, misjudgement and even cancellation of limits.

Most importantly with a more complete picture of the market, in the event of a limit reduction or even cancellation, we can influence an Underwriter to make more sound decisions. And thanks to our network, we can secure the necessary information for an Underwriter which can include meeting the buyer if this is deemed necessary.

Back to our client! The really good news was that whereas before they had just a 10% or 20% acceptance rate (in one case even 0%) with the external Top-Up solution we could achieve limits of up to 100% of their requirement. They could continue to trade successfully with the right Policy in place.