Coming back home: A large, U.S.-based agribusiness wanted to bring its trade credit coverage back to the U.S. The insurance, needed for its business relationships with two Latin American customers, had been placed with an overseas carrier.
“The customer was looking to move to a policy issued out of the United States to reduce the cost of the overseas-issued policy,” said Ryan Cummings, Head of Short-term Multibuyer Trade Credit in Zurich North America’s Credit & Political Risk division.
Among the challenges, Ryan explained, was that the customer wanted to implement wording in line with the overseas carrier’s policy, which had been modified and diluted.
“This was a pretty unique situation where we were being asked really situational-specific questions,” Ryan said. “As a result, we had the challenge of amending our wording to help fit the needs of the customer but maintain the policy’s integrity.”
Trade credit is complex but, as Ryan noted, also a sector with “a broad brushstroke. We would cover the non-payment of one of a client’s customers. The non-payment could be for a number of reasons. It could be simply that they go bankrupt or they have serious delays in paying. There may be a political risk aspect, where the foreign government prevents U.S. currency from leaving the country and, as a result, the buyer is unable to pay. Those are the kinds of risks we are covering.”
Listening to the broker and customer: Ryan and his team went to work, sensitive to the wishes of the customer and broker.
“We spent a good deal of time with the customer and the Select Broker to understand their concerns and determine how to accurately address the issues within the policy wording,” he said.
On that end, Ryan’s team enlisted the assistance of Zurich’s Underwriting and Claims units. Trade Credit policies also have the added task of addressing global compliance issues.
“In many cases, our wording was already sufficiently covering the concerns,” Ryan said, “and where necessary, we worked with our colleagues in Technical Underwriting and Claims to amend our wording in a way that would maintain our underwriting principles and still satisfy the customer.”
All of the conversations Ryan and his team were willing to have not only helped iron out the coverage issues, but also underscored their commitment to the broker and customer.
“The broker was very pleased with our product knowledge. It was something that a lot of underwriters don’t provide — those back-and-forth discussions and explanations for why they’re choosing to do things and why they’re not, and how it’s already incorporated into the policy,” Ryan said. “And the customer actually made comments about how they appreciated the time that we’d taken to go through this and address compliance issues and walk through the various situations with them. That is in line with the product knowledge that we have, and how our policy had been adapted for their needs.”
Harvesting a win: Zurich won the business, and both the broker and customer were satisfied.
“The broker was able to demonstrate that they know the client’s business and negotiated on their behalf in order to maintain coverages under a less expensive alternative,” Ryan said. “The client was impressed with our flexibility and willingness to put in the time to understand their business.”