Trade Credit Insurance – An Effective Business Turnaround Tool

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Any company that’s trying to turn itself around and improve itself has four common goals that they must achieve: lower expenses, increase the sales volume, increase profits, and improve and manage risk. A Euler Hermes ACI trade credit insurance program achieves all four of those goals at one time.

A highly professional company with topnotch products and services can still find itself in trouble if a buyer fails to pay for the goods or services rendered. Trade credit insurance allows a business to protect its greatest liquid asset – its receivables – as well as provide the assistance needed for a company to turn itself around and become profitable, according to a recent national audio program.

In a recent interview with the Sky Radio Network heard on six major airlines between November 2005 and February 2006, Euler Hermes ACI Executive Vice President Joe Ketzner and Sales Vice President John Caffrey provided information on how trade credit insurance can help a company that sells its goods and/or services either domestically or internationally return to profitability.

“Any company that’s trying to turn itself around and improve itself has four common goals that they must achieve: lower expenses, increase the sales volume, increase profits, and improve and manage risk,” said Caffrey. “A Euler Hermes ACI trade credit insurance program achieves all four of those goals at one time.”

Unlike traditional forms of business insurance that may be filed away until a claim arises or the policy renews, trade credit insurance forms a dynamic relationship between the policyholder and the insurer. “A traditional insurance company basically indemnifies losses and pays claims. In our world, what we like to focus on is avoiding the losses in the first place,” said Ketzner. “The essence of our risk mitigation strategy is having the resources in place to make certain that our clients have access to information monitoring and debt collection.”

Loss avoidance is only the beginning, as trade credit insurance from Euler Hermes ACI has a host of other applications to help a company turn around its sales. For instance, a trade credit insurance policy can allow a company to expand into new markets by providing the business intelligence needed to choose the right buyers. “Moving into a new market creates a new set of risks, because you have a lack of information, a lack of experience, and/or a lack of proximity to the debtor or debtors,” Ketzner said. “Again, a Euler Hermes ACI program closes all those gaps for our policyholder.”

A final turnaround measure trade credit insurance offers involves increasing access to capital, Caffrey said. “By purchasing a trade credit insurance policy and having Euler Hermes ACI securitizing the liquidity of the receivables, a bank has the comfort to provide the maximum level of lending to the customer,” he explained.

Ketzner summed up what gives Euler Hermes ACI a competitive advantage in the trade credit insurance marketplace: “Our focus is on three areas – the development of risk information, effective analysis of that information, and the careful and continuous monitoring of risk after the fact. Whether your customer is in Chicago, China, or Latin America, more than 160 countries worldwide are covered under our risk management blanket.”

To access the complete interview with Sky Radio, visit the Euler Hermes ACI News and Publications page at Links to the audio interview and a transcript can be found at the left of the page.

For more information about Euler Hermes ACI products and services, visit

Euler Hermes is the worldwide leader in credit insurance and one of the leaders in bonding and guarantees. With 5,400 employees in 41 countries, Euler Hermes offers a complete range of services for the management of customer receivables. The North American subsidiary (Euler Hermes ACI) is headquartered in Owings Mills, MD. For more information visit

Euler Hermes, a subsidiary of AGF and a member of Allianz, is listed on Euronext Paris. Standard & Poor’s rates the group and its principal credit insurance subsidiaries AA-.

Press Contact:

Rick Ostopowicz

Euler Hermes ACI Public Relations and Communications Specialist

Phone: (410) 753-0652

These assessments are, as always, subject to the disclaimer provided below.

Cautionary Note Regarding Forward-Looking Statements:

Certain of the statements contained herein may be statements of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. In addition to statements which are forward-looking by reason of context, the words ‘may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential, or continue’ and similar expressions identify forward-looking statements. Actual results, performance or events may differ materially from those in such statements due to, without limitation, (i) general economic conditions, including in particular economic conditions in the Allianz Group's core business and core markets, (ii) performance of financial markets, including emerging markets, (iii) the frequency and severity of insured loss events, (iv) mortality and morbidity levels and trends, (v) persistency levels, (vi) the extent of credit defaults (vii) interest rate levels, (viii) currency exchange rates including the Euro-U.S. Dollar exchange rate, (ix) changing levels of competition, (x) changes in laws and regulations, including monetary convergence and the European Monetary Union, (xi) changes in the policies of central banks and/or foreign governments, (xii) the impact of acquisitions, including related integration issues, (xiii) reorganization measures and (xiv) general competitive factors, in each case on a local, regional, national and/or global basis. Many of these factors may be more likely to occur, or more pronounced, as a result of terrorist activities and their consequences.

The matters discussed herein may also involve risks and uncertainties described from time to time in Allianz AG’s filings with the U.S. Securities and Exchange Commission. The Group assumes no obligation to update any forward-looking information contained herein.


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