Credit Insurance Grain Programme Prepared by Rebecca Bishop and Prudence Chang

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1 National Credit Insurance (Brokers) Pty Ltd Partnering Euler Hermes (a member of Allianz Australia Insurance Ltd) Credit Insurance Grain Programme Prepared by Rebecca Bishop and Prudence Chang

2 Euler Hermes at a glance Global market leader Rated AAby Standard & Poor s and Dagong

3 Euler Hermes at a glance Key figures 2014 Global market leader Rated AAby Standard & Poor s and Dagong 52,000+ Clients worldwide 2.5 billion Consolidated turnover in billion Business transactions protected worldwide 40+ million Companies monitored in risk database 85% of credit limit requests processed in less than 48 hours 380,000 Debt collections handled in 130 countries 1,700 Claims indemnified per week 20,000 Credit limits requests received per day 6,000+ Employees worldwide, including 1,500 risk experts #1 player in trade credit insurance 34% market share globally as at Dec 2014

4 Euler Hermes at a glance For your information please refer to the rating scale below used by Standard and Poor s (Australia) Pty Ltd. The Rating Scale AAA (Extremely Strong) BBB (Good) CCC (Very Weak) AA (Very Strong) BB (Marginal) CC (Extremely Weak) A ( Strong) B (Weak) R (Regulatory Action) Plus (+) or Minus (-); The ratings from "AA" to "CCC" may be modified by the addition of a plus or minus sign to show relative standing within major rating categories. 4

5 About NCI Established in 1985 in Adelaide, Australia Offices in Australia, New Zealand and Singapore NCI Specialist trade credit insurance broker Local expertise and support 5

6 Deregulation Insolvencies and Default (non payment) costing around $50 million between in this industry. Impact- liquidity, cash flow, loss of profit. Wider implications -cost to the economy, market confidence, community. Examples-LGL Commodities, Convector Grain, Sapphire, Sugarloaf View Pty Ltd, One World Grain, Meeniyan Stockfeeds. 6

7 Preserve profit Protect liquidity and cash flow Gain confidence to grow your business Strengthen credit management Buy the equivalent of bank security 7

8 Solution NCI/ Euler Hermes Grain Programme Key Points Complete quick quote form Majority of sales must be grain or grain transport Policies are non-cancellable and are for a 12 month period Covers both domestic and export trade Covers you for goods sold and delivered Applies to Insolvency, Protracted default and Political risk Indemnity level is 90% $5,000 Threshold structure 8

9 Policy premiums are based on maximum liability. This is the maximum payout in a 12 month policy period. Maximum terms of payment offered up to 60 days from dispatch or bill of lading Credit Limits approved by insurer Euler Hermes New limits can be added in at any time or increased. All credit limits are monitored. Insurer will assist with recoveries via NCI collections. 9

10 Pricing OPTION 1 OPTION 2 OPTION 3 ANNUAL MAXIMUM LIABILITY CAP $300,000 $500,000 $1,000,000 FIXED PREMIUM $7,000 $9,000 $17,000 GST $700 $900 $1,700 STAMP DUTY As per rate of debtor domicile NCI FEE $1,500 10

11 Pricing OPTION 4 OPTION 5 OPTION 6 ANNUAL MAXIMUM LIABILITY CAP $1,500,000 $2,000,000 $2,500,000 FIXED PREMIUM $25,000 $33,000 $42,000 GST $2,500 $3,300 $4,200 STAMP DUTY As per rate of debtor domicile NCI FEE $1,500 11

12 Key Reporting Requirements 1. Not to offer terms greater than 60 days from dispatch or bill of lading 2. Obtain an approved limit on buyer. Add new buyers in at any time. 3. Trading to the approved limit amount limits can be increased at anytime 4. Reporting accounts that breach the maximum extension period 5. Notify of an adverse event such as a bounced cheque 6. Repayment plans must be approved by insurer 12

13 Limits support What NCI Does Review application and provide advice Internal limit reviews Analysts sourcing additional information and collecting financials Expert negotiators Claims support Assistance and assessment of claim prior to lodging Internal claims and compliance manager Relationships with liquidators for speedy confirmation of debt Market strength when negotiating goodwill payments 13

14 How NCI can assist Auto alerts Early warning signs Avoid problem payers Manage your policy online 24/7 14

15 1. Deal with the right entity 2. Timely advice on changes 3. Reliable credit limits 4. Customer profiles 5. Practical advice 15

16 Protect your debtors ledger Reduce your costs Improve your cash flow Risk free collections Real time reporting 16

17 QUESTIONS? 17