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So, what exactly is CoFace Credit Insurance?

CoFace Credit Insurance is the insuring of a client’s account receivables from the risks of bankruptcy, slow pay, and credit risk. The insuring process is conducted by reviewing your client's top 15 customers. The review process focuses on consolidated financials, payment ratings, company age, location, line of business, court rulings, trade references, and industry trend behavior. All of these items factor into how much insurance coverage will be extend to a specific customer. Once that insurance coverage number is established your client will be protected from their customers going bankrupt, or slow paying them for the term of the policy, up to the limit of coverage approved.

Example: Let's say your client does $300K worth of business to Company A and they request credit insurance to cover their outstanding receivables to Company A. CoFace Credit Insurance would underwrite Company A; depending on the outcome of underwriting; 1 of 4 scenarios occurs.

• Company A is granted $300K worth of coverage
• Company A is granted a larger than requested amount
• Company A is granted less than $300K
• Company A is not granted any coverage due to significant risk

If Company A is granted coverage, then your client is protected up to the limit of that coverage amount against Company A going bankrupt, or slow paying them.

How does credit insurance help me to fund more deals?

Once your client has secured a CoFace Credit Insurance policy they have turned their account receivables into secured assets. The CoFace policy they secured can have a loss payee assigned; the loss payee will receive any paid claims from bankruptcy and/or slow paying clients.

It is this feature of the CoFace Credit Insurance policy that will allow you to lend more, as the receivables are now guaranteed to be paid which increases their value. As a lender you can also request to have your client name you as a loss payee on their CoFace policy as a requirement for funding. This allows you to be paid directly should their clients go bankrupt or slow pay.

Example: Your client now has secured a $300K CoFace Credit Insurance policy on Company A; as a result, you are able to lend up to 90% of the value on Company A receivables, because they are secured from bankruptcy risk and slow payment, additionally your risk is lowered dramatically because you are named as a loss payee in the event a claim needs to be filed.

Lenders always strive to meet their clients need while maintaining a balance between risk and reward. By requiring clients to obtain CoFace Credit Insurance you can lend more, lower risk, and have happy clients.

For more information on CoFace Credit Insurance call James Graydon at 212-560-0434 to discuss how CoFace Credit Insurance can assist your clients. http://www.coface-usa.com/