UK Electronics companies were urged to look at credit insurance with a wider vision at a forum for electronics sector insurance brokers held this week by Gerling NCM, a credit insurance and receivables management company.
Attendees were told that credit insurance should be seen as a tool which not only protects against bad debt but also as a means of improving cash flow, moving into new markets, reassuring the bank, protecting against volatility in the sector and even boosting R&D.
Gerling NCM, which is soon to be renamed Atradius, claimed that few of the 7,545 UK electronics manufacturing companies, which account for 10% of GDP, have explored, let alone taken up, credit insurance.
The company says the failure of a number of providers, including Dolphin and OT Group, has made electronics companies see credit insurance as a very narrow tool, and the sector as a high-risk area that insurers will not want to touch.
Paula Evans, industry development manager at Gerling NCM, said, “These are myths which we must all work hard to dispel.” Yes some parts of the electronics industry are tough areas for us to work in, but if the insurer and the business work really closely, sharing information, credit insurance can be business-transforming.”