Glossary

 

Atradius Modula
A family of modular credit insurance policies, offering companies greater flexibility to tailor their policies to their specific needs.

Atradius Observa News
A business news service, which provides up-to-date news on companies selected by he subscriber.

Bonding
The activity of providing guarantees that protects the beneficiary if the supplier fails to meet the agreed performance level. Bonding is also known as surety insurance.

Buyer underwriting
Is concerned with the risk acceptance of the buyers with whom the customers trade. Buyer underwriting establishes the credit limits thai are attached to the credit insurance policy and determines the amount for which shipments are insured. Buyers are assessed on financial and non-financial criteria, including financial status, profitability, liquidity, size, region, trade sector and payment experience.

Claim
An application by the insured for indemnification of a loss under the policy.

 

Claims ratio
A performance indicator that is defined as total claims including claims handling expenses divided by total insurance revenues.

 

Combined ratio
The sum of the Claims ratio and the Expense ratio.

Credit insurance
Commercial and/or political risk insurance whereby the customer is protected against non-payment of trade receivables due to insolvency or default.

Credit limit
The maximum exposure specifically approved or otherwise authorised by the insurer in respect of a buyer.

 

Debt collection
Activity to collect monies owed by a company. Atradius offers this service both to insured customers and third parties.

 

Economic capital
The amount of risk capital, assessed on a realistic basis, required by a company to cover its risks assumed under insurance contracts.

 

European Economic Area (EEA)
An economic association of European countries, including all member countries of the European Union (EU) and Iceland. Norway, and Liechtenstein.

Euro-zone
Refers to the European Union member states that have adopted the Euro as their currency.

Expense ratio
A performance indicator that is defined as total insurance expenses divided by total insurance revenues.

Exposure
Total amount underwritten by the insurer as cover on a buyer, a country or under a policy or all policies.

Factoring
The purchase of a trade debt by a third party at a discounted rate.

 

Global
Our product and service offering to multinational customers, which provides tailored credit management solutions for customers worldwide in several languages and currencies.
 

Insolvency
Legally recognised inability of a debtor to meet his commitments and pay his debts.

 

Instalment credit protection
Our offering to financial and corporate policy-holders in France. Belgium and Luxembourg, that protects against short and medium-term risks involved in multiple instalment agreements with private individuals and businesses (business-to-consumer).

 

Insurance revenues
The total of gross earned premiums and credit checking fees.

 

Medium term business
Business (capital goods and major projects) transacted on credit terms of between two and five years.

 

Policy underwriting
Is concerned with customers and establishes the terms and conditions of the insurance policy designed to mitigate unacceptable risks. These terms and conditions include premium rate, maximum credit periods, the insurer's maximum liability, the customer's own retention and other risk sharing and mitigation aspects.

Political risk
The risk that a government buyer or a country prevents the fulfilment of a transaction, or fails to meets iis payment obligations, or the risk that is beyond the scope of an individual buyer or falls outside the individual buyer's responsibility.

 

Premium
Amount paid by an insured client to the insurer in return for risk coverage.

 

Reinsurance
Is a risk sharing operation, whereby the insurer obtains cover from a third party (the reinsurer) for part of the credit risks that it has guaranteed, in exchange for the payment of a premium.

Securitisation
Asset-backed financing achieved through the sale of trade receivables to a special purpose vehicle which is funded through the issuance of short term debt into the capital markets.

 

Single situation cover
Cover on a single buyer and/or transaction and political losses including pre-credit cover.

 

SME
Small and Medium-sized Enterprises.

 

Solvency II
A regulatory process for insurers and reinsurers. It aims to ensure understanding by insurers of the inherent business risks in the industry and the allocation of sufficient capital to cover ihem.

 

Underwriter
Person charged with risk acceptance, control of that risk and the setting of cover conditions on buyers/credit limits, including any country-specific terms of cover.

Whole turnover policy
A service whereby protection is provided to the insured in the form of a credit insurance policy that covers the insured company's total trade receivables against the risk of non¬payment by their buyers (for commercial risksi and the country of the buyers (for political risks).