I totally understand that. I was in the construction business for fifteen years. I had general liability, workers comp, fleet insurance, commercial property insurance, E&O insurance…the list goes on.
These were all products I had to have and pay for year in and year out “just in case.” I considered them an expense because they cost me money and yet gave me no love in return. I had these insurance products—was required, really—and used them maybe three times in fifteen years.
Yes, workers comp came in handy when my employees got hurt on the job, but the premiums I paid out over the course of fifteen years vs. the claims that were covered is disjointed to say the least.
So there you go. An expense is money you spend without hope of getting any of it back. Once you spend it, it’s gone. Forever.
An investment, on the other hand, by its very definition means “money spent in order to gain profitable returns.” Profitable returns as in interest, income or an appreciation in value.
How many business insurance products do you know that gain you interest, income or appreciate in value?
I wouldn’t fault you if you said ZERO, but you’d still be wrong.
There is ONE insurance product that you should consider an investment. And if you’re a business owner or CFO it’s also an insurance product you should have in your arsenal.
It’s called Trade Credit Insurance, or Credit Insurance, or Accounts Receivable Insurance. At its very heart, Credit Insurance protects your accounts receivable against non-paying clients because of bankruptcy or insolvency.
Yes, there’s a premium you pay every year, which is why some people might view it as just another insurance product. Just another business expense.
But Credit Insurance isn’t just a pile of paperwork that sits ignored in a drawer like all your other insurance policies. Credit Insurance improves cash flow.
Improves access to short-term capital.
Enables business expansion.
Performs “financial checks” on your clients.
In other words, Credit Insurance gives back. And through it, you gain profitable returns. It lets you grow and expand. It makes you money. In that regard, Credit Insurance is very much an investment.
Credit Insurance is a sound investment for your company. And it’s a product you need if you’re thinking of expanding, growing business internationally, or have had trouble with payment in the past.
For more information about Credit Insurance read this. Or get our Free Report here. Or contact us.
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