Trade Credit Insurance Writeup
Trade Credit Insurance Presentation
Trade Credit Insurance Proposal Form

Credit Insurance Benefit Calculator

  • Personal Information
  • Company Information
  • Result
  • Thank you

* First Name:
* Last Name:
* Mobile Number:
* Email ID:
Note: OTP will be generated on your mobile and email
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Disclaimer :
Please note that the calculations displayed by this tool are based on some standard assumptions and parameters, which may or may not be applicable to your business. Hence the result are intended solely for guidance, general information and education purposes and has no legal effect on any contracts. This simulation and the resulting calculations do not constitute an Offer. The figures and formulae used within this calculator may change at any time without notice. The result provided by this tool should NOT be considered as a substitute for any professional advice. The premium estimated by this calculator is based on certain criteria and is applicable more so to domestic trade but can also act as a guide to international trade as it aims to demonstrate the advantage of trade credit insurance and not an indication of premium cost. Your actual premium may be higher or lower depending on the actual information you may provide to us depending upon specific requirements sought on a case to case basis through proposal forms and other formats which may be required for the purpose. The actual cost of credit insurance would vary depending upon specific information and their analysis and specific requirements. The final cost of Credit Insurance would be specifically provided by an Insurance Company through us and they are entitled to apply their judgement and appetite on producing Insurance Quotes and Terms. We are in no way liable of any actions that might be taken by users solely based on this calculator.


Use the handy calculator below to determine the tangible financial benefit your company can realize from a properly structured credit insurance program. More than just "Passive" insurance cover, credit insurance is a financial tool that can help you achieve several important business objective

Simply enter your company's information in the fields below. You may try as many different scenarios as you like closely representing your historical, current or projected financial information to get appropriate results


* Industry Segment :
* Projected Annual Sales :
INR
* Average Accounts Receivable Outstanding :
INR
Receivables exceeding 90 days from Due Date of invoice :
INR
* Average Number of Buyers Carrying Exposure at any Given Time :
No.
* Gross Profit Margin (%) :
%

View Industry Gross Profit Margins

Current Interest Rate on Working Capital :
%
Excluded Receivables :
INR
Enter Current %age of Trade Receivable financed by bank here :
%
No. of losses on Average exposure :
No.
Enter Return on Captial Employed Percentage here :
%
Rate of Income Tax :
%
Bad Debts reserve created for debts that are overdue in excess of 90 days from due date :
%





Disclaimer :
Please note that the calculations displayed by this tool are based on some standard assumptions and parameters, which may or may not be applicable to your business. Hence the result are intended solely for guidance, general information and education purposes and has no legal effect on any contracts. This simulation and the resulting calculations do not constitute an Offer. The figures and formulae used within this calculator may change at any time without notice. The result provided by this tool should NOT be considered as a substitute for any professional advice. The premium estimated by this calculator is based on certain criteria and is applicable more so to domestic trade but can also act as a guide to international trade as it aims to demonstrate the advantage of trade credit insurance and not an indication of premium cost. Your actual premium may be higher or lower depending on the actual information you may provide to us depending upon specific requirements sought on a case to case basis through proposal forms and other formats which may be required for the purpose. The actual cost of credit insurance would vary depending upon specific information and their analysis and specific requirements. The final cost of Credit Insurance would be specifically provided by an Insurance Company through us and they are entitled to apply their judgement and appetite on producing Insurance Quotes and Terms. We are in no way liable of any actions that might be taken by users solely based on this calculator.



CREDIT INSURANCE ANALYSIS RESULTS
Number of Times You Turn Debtors in to cash per year
Average Days Sales Outstanding
Average Buyer Exposure
Estimated Cost of Credit Insurance Programme
ANALYSIS OF PROBABLE GAINS DUE TO CREDIT INSURANCE
Net Probable Financial Gain Due To Borrowing Enhancement
Net Probable Financial Gain Due To Interest Cost Savings
Net Probable Financial Gain Due To Increased Sales
Net Probable Financial Gain Due To Reversal Of Baddebts Reserves
Net Probable Financial Gain Due To Tax On Credit Insurance
Net Probable Financial Gain Due To Interest Cost Savings On Overdues In Excess Of 90 Days
Total Probable Gain Due To Credit Insurance
(Not Considering The Potential Intengible Gains Of Credit Insurance)
Net Probable Gain Due To Credit Insurance (Net Of Premium)
Effective rate of premium on credit insurance
INTANGIBLE GAINS
1. Increase in market share
2. savings in cost of collections
3. Information on customer's creditworthiness
4. Focusing on sales expansion rather than collection

INCREMENTAL SALES REQUIRED TO CAPTURE COST OF CREDIT INSURANCE
Cost of credit insurance program
Gross profit margin
Incremental sales
Percentage of incremental annual sales required to capture cost of credit insurance to projected annual sales
Projected annual sales expected on the back of credit insurance program as percentage of sales
Net additional annual sales due to credit insurance as percentage of sales
If your company generates additional revenue equal to incremental sales due to credit insurance, the cost of the credit risk insurance program will be more than recaptured. Any additional revenue generated will drop directly to your company's bottom line! The protection would be provided at a true net zero (0) cost to your company.
COST OF SELF INSURANCE
Increased Interest Cost On Working Capital
Loss Of Additional Profit Before Tax
Loss of additional profit due to reserve on overdue debts
Additional Interest Cost On Overdue > 90 Days
TOTAL POTENTIAL ADDITIONAL COST OF SELF INSURANCE
(Not Considering The Potential Intengible Cost Of Self Insurance)
INTANGIBLE COSTS
1. Cost of obtaining credit information reports on buyers?
2. Costs of credit and collection services?
3. How much tax do you pay on your bad debt Reserve?
4. (Releasing this reserve in year one as earnings will result in tax savings in future years)

STRESS TESTING YOUR BUSINESS
Your company's average accounts receivable exposure
Value of expected losses on average exposure
Additional sales required to recapture the losses
Percentage of sales required to total sales to recapture bad debts
POINTS TO PONDER UPON
1. How much profits you have lost on account of withholding credits to your customers
2. What is the bad debts you will actually witness?
3. How many such cycles will you generate to make good the bad debts??
4. At what cost??
5. What is the guarantee of not having bad debts on these new sales??





Disclaimer :
Please note that the calculations displayed by this tool are based on some standard assumptions and parameters, which may or may not be applicable to your business. Hence the result are intended solely for guidance, general information and education purposes and has no legal effect on any contracts. This simulation and the resulting calculations do not constitute an Offer. The figures and formulae used within this calculator may change at any time without notice. The result provided by this tool should NOT be considered as a substitute for any professional advice. The premium estimated by this calculator is based on certain criteria and is applicable more so to domestic trade but can also act as a guide to international trade as it aims to demonstrate the advantage of trade credit insurance and not an indication of premium cost. Your actual premium may be higher or lower depending on the actual information you may provide to us depending upon specific requirements sought on a case to case basis through proposal forms and other formats which may be required for the purpose. The actual cost of credit insurance would vary depending upon specific information and their analysis and specific requirements. The final cost of Credit Insurance would be specifically provided by an Insurance Company through us and they are entitled to apply their judgement and appetite on producing Insurance Quotes and Terms. We are in no way liable of any actions that might be taken by users solely based on this calculator.

You can reach out to our Credit Insurance experts at CA Mehul Palan mehul@allianceinsurance.in or 9920707454.