Credit Insurance
Provides protection against specified credit-related losses. Depending on the product, this may include repayment of outstanding loans following an insured event affecting the borrower or protection against a buyer's failure to pay a trade debt.
Get a Quote NowWhat's Covered
Outstanding Loan Balance Repaid
If a specified insured event affects the borrower while the loan is still running, the insurer settles the outstanding principal, interest and fees on the covered loan, so the debt does not fall on the family or the business.
Death & Disability of the Borrower
Cover is triggered by insured events such as the death or total permanent disability of the borrower. Some products extend to critical illness or temporary incapacity, depending on how the policy is written.
Buyer Insolvency
For sellers trading on credit terms, a claim can be paid when an approved buyer is placed under administration, receivership or bankruptcy and cannot settle invoices for goods already delivered.
Protracted Payment Default
When a buyer simply stops paying and the account runs overdue beyond the waiting period defined in the policy, commonly 90 days past the due date, the debt qualifies as a default and a claim can be lodged.
Invoiced Trade Debt
Cover applies to the value of goods or services actually supplied and invoiced under agreed credit terms, up to the credit limit approved for that buyer when the order was shipped.
Export Credit & Political Risk
Export policies can extend beyond buyer risk to political events such as war, civil unrest, currency inconvertibility and transfer restrictions that stop payment arriving from abroad.
Why Credit Insurance Matters
One Default Can Erase a Year of Profit
Wholesalers and distributors often run on 8 to 12 percent net margins. A single unpaid invoice of KES 3 million can wipe out months of hard-earned profit in one stroke.
Selling on Credit Is the Norm
Supermarkets, distributors and institutional buyers routinely demand 30, 60 or 90-day terms. If you want the business you extend credit, and every day of terms is a day of exposure.
A Loan Book Is Only as Good as Its Borrowers
Banks, SACCOs and microfinance lenders carry real exposure when borrowers die or are permanently disabled before clearing their facilities. Credit cover keeps the loan book performing.
Cash Flow Does Not Recover on Its Own
Unpaid invoices tie up the working capital you need for stock, payroll and supplier payments. Insurance converts a bad debt into a settled claim and puts cash back into the business.
Chasing Cross-Border Debt Is Slow and Costly
Recovering from an overseas buyer means legal fees, long delays and uncertain outcomes. Export credit cover pays out while you keep trading instead of spending months in pursuit.
Lenders Reward Protected Risk
Businesses with credit insurance in place often find it easier to secure working capital facilities, because the lender's own security is stronger and the loss given default is lower.
How It Works
Map Your Exposure
We review your sales ledger or loan book: turnover by buyer, credit terms, outstanding balances and concentration risk, or the loan amounts and repayment profiles at stake.
Set Limits & Choose Cover
For trade credit, each buyer is assessed and given an approved credit limit. You choose the indemnity level and whether to cover your whole turnover or selected accounts.
Cover in Force
The policy runs for twelve months. Shipments made and loans advanced within approved limits during the period are protected automatically as they arise.
Lodge a Claim
Report the death, disability, insolvency or overdue account within the required timeframe, submit invoices, statements and supporting documents, then receive assessment and settlement.
Types of Credit Cover
Choose the cover that matches your side of the ledger: a lender protecting the loan book, or a seller protecting the receivables.
Loan Credit Cover
Credit cover on loans. The outstanding loan balance is repaid when a specified insured event, such as death or total permanent disability, affects the borrower.
- Repayment of the outstanding loan balance
- Death and total permanent disability benefits
- Single or joint borrower arrangements
- Benefit reduces as the loan balance falls
- Available for personal, business and asset loans
Trade Credit Insurance
Protects a seller against a buyer failing to pay an invoiced debt, typically because the buyer becomes insolvent or defaults beyond the period defined in the policy.
- Cover for approved buyers trading in Kenya
- Buyer insolvency and protracted default
- Indemnity typically up to 90% of the loss
- Credit limits approved buyer by buyer
- Whole turnover or single-buyer options
Export Credit Insurance
Extends trade credit protection to overseas buyers, with optional cover for political risks that can stop an agreed payment from crossing the border.
- Cover for overseas buyer accounts
- Insolvency and protracted default abroad
- Political risk and transfer restrictions
- Short-term cover on open account terms
- Supports entering new export markets
Who Is This For
Banks, SACCOs & Microfinance Lenders
Lenders carrying loan books can protect against loss when borrowers die or become permanently disabled before settlement of the facility, keeping the portfolio stable.
Businesses Selling on Credit
Wholesalers, distributors, manufacturers and service providers who invoice customers and wait 30 to 90 days for payment carry the buyer's risk every day.
Exporters & Cross-Border Traders
Companies selling to buyers outside Kenya face both commercial default and political risk on the route to payment. Export credit cover addresses both.
Suppliers with Concentrated Buyers
Businesses relying on a handful of large accounts, such as supermarket chains or institutional customers, where a single default can threaten the whole operation.
Common Mistakes to Avoid
Treating cover as a guarantee of full recovery
Credit insurance pays an indemnity, commonly around 90% of the loss after any excess, not every shilling owed. Price that uninsured portion into your decisions before you need it.
Not declaring buyer credit limits
Cover only applies within the limits approved for each buyer. Shipping above an approved limit, or to a new buyer you have never declared, can leave that debt completely uninsured.
Assuming every non-payment is covered
Policies typically require buyer insolvency or default as defined, such as an account running 90 days overdue. A late payment, a delivery dispute or a contract quarrel may not qualify.
Reporting overdue accounts too late
Most policies require you to notify overdue accounts within a set window, often 30 to 60 days after the due date. Miss that window and the claim can be reduced or declined.
Frequently Asked Questions
How is credit insurance different from a loan guarantee?
A guarantee is a promise from a bank or development institution to repay if the borrower defaults. Credit insurance is a policy that pays for defined insured events, such as the borrower's death, disability, a buyer's insolvency or a default as set out in the contract.
Does the policy pay 100% of what I am owed?
No. Credit policies usually pay an indemnity of around 80 to 95% of the covered loss, often with an excess. Cover also applies only up to the approved credit limit and to invoices issued while the policy is in force.
What counts as a buyer default?
Typically the buyer's insolvency, bankruptcy or receivership, or a protracted default where the account remains unpaid for a defined period, commonly 90 days past the due date. Simple late payment inside that window is not yet a claim.
Do I need credit limits for my customers?
For trade credit insurance, yes. Each buyer is assessed and given a limit, and sales within that limit are covered automatically. You declare your turnover and buyer list, and limits are reviewed as your book changes.
What happens if a borrower dies while a loan is running?
Notify the lender and the insurer and provide the death certificate and loan statements. Once the event is verified under the policy, the insurer settles the outstanding covered balance, releasing the estate or business from that debt.
Is political risk covered on exports?
It can be. Export credit policies can include cover for war, civil unrest, currency inconvertibility and transfer restrictions that prevent an overseas buyer's payment from reaching you. Confirm the extension when you take out the policy.
How is the premium calculated?
Trade credit premium is usually a percentage of your annual credit turnover, adjusted for buyer concentration, terms offered and claims history. Loan credit cover is priced on the loan balance, borrower age and the benefit type selected.
Can I insure just one large customer?
Single-buyer policies exist when one account dominates your risk. Otherwise a whole turnover policy covers your full approved buyer list, which is usually simpler and spreads the risk more broadly across your book.
Real Talk
A customer who has paid on time for three years can still fail the quarter after you deliver your biggest order. That is how credit risk behaves: it looks fine right up until the day it does not.
Credit insurance is not pessimism. You are already carrying your buyers' risk every single day you sell on terms. The cover simply decides who pays when that risk turns into a loss.
Set the limits, watch the overdues, and never sell blind.
Credit insurance products are offered by licensed insurance companies. Cover, indemnity percentages, credit limits, exclusions and premiums vary by insurer, product and applicant. The information on this page is for general guidance only and does not constitute a quotation or binding offer. Please contact us for personalised quotes and advice tailored to your loan book or customer base.
Extend Credit With Confidence
Whether you are lending or selling on terms, get covered before the next loan is disbursed or the next invoice leaves your office. One policy, stronger cash flow.
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