Encharter Eric Voegtle Trade Credit Insurance

Economic Report from Encharter Insurance 1st Quarter 2010

2010-04-08T13:49:00.001-04:00

The recovery of current world economic conditions continues to be fragile after a positive second half of 2009. We will see 2010 as a year of peaks and valleys between good and bad economic indicators. Many countries will see a high level of insolvencies during the first half of 2010 and no real improvement for the second half of the year. Those countries where there will still be a rise of insolvencies will be centered primarily in Europe, but we will begin to see a decline of insolvencies in the United States, Canada, Brazil and a few Asian countries.

What does this mean to the average buyer of Trade Credit Insurance from Encharter Insurance? We will see continued pressure to raise premiums from all the Trade Credit Insurance carriers such as Euler Hermes ACI, Coface North America, Atradius, FCIA, Chartis and others. 2008 and 2009 was good and bad for the industry and its clients; the good were indicated by increased recognition of the value of Trade Credit Insurance, whereas the bad were indicated by higher claims resulting in higher premiums and reductions in coverage. This put a bad taste in the mouths of many current and prospective entrances into the world of Trade Credit Insurance.

The good news is that for companies looking at credit insurance for the first time in 2010 and 2011, it will be easier to get the coverage needed on customers still on shaky ground and pricing will have stabilized. There will be an increase in competition among the insurance companies because they must grow their top-line after the last 2 years of shrinking revenues and higher expenses. I’m confident in the strength of these companies and if they made it through the worst economy since the end of World War II, I think they will be around to support and protect business’ sales and profitability for many years to come.

If you would like to learn more about purchasing Trade Credit Insurance from Encharter Insurance, call Eric Voegtle at 888-865-1244. As an expert in the field, he would like to talk with you about your options. You can also visit our virtual insurance office at www.encharter.com to get a FREE quote on Commercial Auto Insurance, FREE quote on General Liability Insurance, and any other business insurance needs you may have. And the agents in our insurance office in Amherst MA, our insurance office in Lexington MA, our insurance office in Reading MA, and our insurance office in Watertown CT would like to speak with you!

At Encharter, “It’s all about protecting you!”

Economy Recovering...Time to Buy Trade Credit Insurance!

2010-04-06T12:21:00.002-04:00

Why should a company continue to purchase protection for their accounts receivable from Encharter Insurance now that the economy is showing signs of recovery? This is a simple question, but one that has plagued the industry since the 1890’s. Most companies rush to protect their accounts receivable during bad times for obvious reasons: they are worried that they will never receive payment or at least full payment, or that their customers will either pay slow enough to hurt their cash flow or file bankruptcy. But when times are good, too often a company ignores this important protection.

Trade Credit Insurance should be treated like any other insurance; it should be there when a catastrophic event occurs. It is well known that someone should purchase any type of insurance when they don’t need it. This makes the insurance companies feel comfortable that the purchaser is practicing sound risk management. Furthermore, purchasing Trade Credit Insurance during good times will be less expensive than what we saw in 2008 and 2009 when the economy was on less-stable ground and coverage on key customers is easier to obtain. Purchasing Trade Credit Insurance, also known as Accounts Receivable Insurance or Credit Insurance, through a full-line Property & Casualty insurance agency such as Encharter gives the purchaser access to many options and unique expertise, which are very helpful in navigating the insurance world.

So now that the economy is showing signs of recovery, NOW is the time to buy Trade Credit Insurance! Call your knowledgeable Encharter Insurance agent, Eric Voegtle, today at 888-865-1244! You can also visit our virtual insurance office at www.encharter.com and research the other types of commercial insurance that we offer our valued customers: General Liability Insurance, Commercial Auto Insurance, and many more! And of course, you can always visit our agents at our insurance office in Watertown CT. They are waiting to serve you.

At Encharter, “It’s all about protecting you!”

The Great Recession and Trade Credit

2009-12-21T16:08:00.000-05:00

At Encharter Insurance we offer general Commercial Insurance products, such as Commercial Property, General Liability, Worker’s Compensation and Bonds. In addition to these competitively priced commercial insurance products, Encharter Insurance offers a widely unknown, but equally important product, Accounts Receivable Insurance or sometimes called Trade Credit Insurance.

Most economists say that this Great Recession started in 2007 and is the worst recession since World War II. There are a few theories as to what will happen next.

- Full Recovery of the world economy
- Uneven Recovery, where developed economies will be flat and emerging economies will see a strong recovery.
- Double dip recession, when the current stimulus programs expires the absence of this type of backing without something to fill this void, world economic growth will go back to negative.

The current data available about the deterioration of corporate profits is staggering. After years of an aggressive bank lending environment, coupled with low insolvencies, gave most corporate leaders a false sense of security. Only a short time ago insolvencies were hovering around .5% worldwide, now we are seeing corporate insolvencies at 3%. From the first quarter of 2008 to the second quarter of 2009 commercial bankruptcies increased 208 percent. There were 58,000 commercial bankruptcies in the U.S. during the first half of 2009.

This has had a dramatic effect on the supply and demand of Accounts Receivable Insurance, also known as Trade Credit Insurance. With the insolvencies and the uncertainty we see the demand for Trade Credit Insurance is at an all time high, even though the market penetration for the product is still relatively low. More and more, companies are exploring the use of Accounts Receivable Insurance from Encharter Insurance to protect one of their largest assets, accounts receivable, from loss due to a risky customer and even relatively benign customers.

The past several years have seen a soft market for credit insurance. Premiums have dropped, while the insurers have become more and more competitive to gather as much business as possible. This trend is starting to change as the market for Trade Credit Insurance hardens. We are now seeing premiums increase; however the premiums now being charged are still lower than the cost of Accounts Receivable Insurance offered in the 1980’s and 1990’s.

With premiums on the rise for Trade Credit Insurance, calling Encharter Insurance today at 888-865-1244 to discuss getting your business set up with a Trade Credit Insurance policy is a smart move. You can also visit us on the web to request a quote for Accounts Receivable Insurance or any other Commercial Insurance product 24/7 by visiting our website at http://www.encharter.com/

At Encharter, “It’s all about protecting you!”

What can Encharter’s Accounts Receivable Insurance do for your company?

2009-10-30T12:35:00.000-04:00

Encharter Insurance offers both domestic and export accounts receivable insurance for small, medium and large companies in just about every industry.

Having Accounts Receivable insurance allows you to sell with confidence, protecting your company against the repercussions of a domestic or foreign customer insolvency or non-payment. This type of insurance gives companies like yours a competitive advantage. Often times, credit lines can be increased for your customers with an Accounts Receivable Insurance policy in place.

When you have an Accounts Receivable insurance policy through Encharter Insurance, you can protect your accounts receivable and:

- Avoid catastrophic bad-debt losses
- Achieve financial objectives more confidentially
- Safely expand sales
- Secure better borrowing terms
- Reduce bad-debt reserves

Partnering with Encharter Insurance will give you a competitive edge. Encharter Insurance will not only handle all your questions about the product, but we also have access to all the markets for Accounts Receivable Insurance. Encharter Insurance has partnered with the preeminent companies in the Accounts Receivable Insurance industry, let Encharter Insurance do the shopping for the right Trade Credit insurance coverage for your business at the lowest possible price.

If you have questions about Accounts Receivable Insurance, or questions about any type of Commercial Insurance policy, call Encharter Insurance today at 888-865-1244 or visit us on the web at http://www.encharter.com/

At Encharter, "It's all about protecting you!"

What is Credit Insurance?

2009-10-22T15:08:00.000-04:00

When most business owners and finance managers hear the term, they know this to be a product to protect their accounts receivables. Other terms used for this product are Accounts Receivable Insurance, Trade Receivable Insurance or Bad Debt Insurance. But to most non-financial people, they will think that credit insurance is personal lines product protecting an individual if they become sick or lose a job and they have loans and credit cards requiring repayment during a temporary financial setback. The two must not be confused, although both are similar in the way that they protect the creditor (bank or company) from non-payment. For the purpose of this article the term Credit Insurance should be used in relation to commercial accounts receivables and for simplicity sake let us use Accounts Receivable Insurance as the title for this product.

First let’s define what are accounts receivables? Simply put, a receivable is an amount of money owed to one party from another party in exchange for a good or service. It is a promise to pay at some date in the future. Usually no longer then 6 months, but normally anywhere from 30 to 60 days from goods being shipped or services rendered. A real life example would be a manufacture of hammers that relies on hardware stores, mail order houses and national or regional home improvement chains to sell their hammers. The hammer manufacture will sell an amount of hammers to a store, but not require payment until 30 days from shipment. The hammer manufacturer will categorize the shipment as a sale, but since money has not exchanged hands there has to be some other way to recognize the exchange of assets for accounting purposes. The receivable is an “I.O.U” of sorts. This allows the hammer manufactures customer to sell the hammers, take its profit and then repay the hammer manufacture for the hammers. The receivable is an asset of the manufacture and should be treated as any other asset such as cash, buildings, equipment or anything else of monetary value.

What happens if the accounts receivable are not paid? This is a big problem and it has increased exponentially since the end of 2007 as the economy began to slow. This is what Account Receivable Insurance is made for.