A credit insurance in the employment agency industry is important to prevent financial risks.
The employment agency industry had grown exponentially over the past few years. Economically everything goes well, and the employment agency industry logically profits from this. The employment agency industry has seen the biggest growth in jobs of the past few years. This growth is due to the general economical growth, and because many companies rather have flexible employees over fixed personnel. Although the employment agency industry has seen a growth over the last few years, there are long-term threats that could harm the market. On the long term, it is possible that Artificial Intelligence (AI) will be a threat to the industry. At the moment, the market is doing well and is still experiencing (turnover) growth. It is important this turnover growth is handled responsibly to prevent financial surprises.
As an employment agency, you are responsible for the wages of the temporary employees. But what happens if the organization where your temporary employees work, is not able to pay the outstanding invoices anymore due to insolvency? In this case, you do have the expenses but you do not achieve the generated turnover. The temporary employees still have to be paid. There is an important tool that can help you cover for situations like this. A credit insurance offers certainty of the turnover being achieved for the employment agency .
A credit insurance has been designed for companies who supply and deliver products or services on credit. The insurance offers certainty that, after the delivery of the products or services, the outstanding invoices are paid. The credit insurance will start working when a debtor, or debtors, are not able to pay the outstanding invoices due to insolvency. The credit insurer with whom the insurance has been taking out will pay for the outstanding invoice, conform the policy. This ensures an optimized cashflow and will prevent the financial continuity from being compromised.
Next to the payment in case of default, a credit insurance offers multiple advantages, provided that these are included into the policy. You will have the possibility to utilize the expertise, knowledge and years of experience of the credit insurer, after taking out the credit insurance. A few credit insurance providers have existed for almost 100 years and dispose of an impressive database with up-to-date information regarding sectors, markets and millions of companies. You can utilize the creditworthiness check as well. The credit insurer checks whether your current and new debtors are creditworthy. This way, financial risks can be limited as much as possible.
The debt collection system is part of the credit insurance as well. The collection system increases the pace in which the outstanding invoices are usually paid. This relatively fast payment optimizes the cashflow.
We, The CreditInsurers, ensure the turnover of hundreds of companies within several sectors. A credit insurance is always interesting as this costs only a fraction of the turnover, but does provide full coverage.
Are you active within the employment agency industry and do you want to know all about the possibilities? Contact us right now. In a free personal consultation without obligation, we would like to discuss all options with you.
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