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TIA | The Insurance Apprentice

Season 4, Episode 3

sponsored by Hollard

Task three #tradecreditinsurance

Hollard does things differently, and by coupling trade credit insurance with credit risk management, a policyholder is able to insure only the debtors that keep them up at night. A full credit review of each selected debtor is completed, providing a good indication of those the client should be doing business with, helping to prevent bad debt in the first place.

Not all debtors are created equal and various factors determine each one’s risk. What really matters, from an insurance perspective, is how well each debtor is assessed as a credit risk – which is the task the apprentices were assigned in episode three, task three, sponsored by Hollard.

Presented with three different debtor-creditor relationships (Debtor one: an IT distributor selling on a recurring basis to a wholesaler, Debtor two: a sub-contractor installing kitchen equipment into a complex for a once-off contract and Debtor three: a diesel wholesaler that sells fuel to a supermarket chain) and making use of guest judges Gareth Joubert, Managing Director of Hollard Trade Credit, and Marvin Tshezi, Head of Procurement at Hollard Insure, the apprentices had to strategize and conduct a credit risk assessment in order to arrive at a clearer picture of each one’s credit risk. They then had to answer six questions:

• Will you insure them?
• What is the highest credit limit you would extend to each?
• What is the ideal credit limit for each?
• How would you rank the three debtors in terms of default risk?
• Would you impose any special conditions to providing trade credit cover?
• Bonus question: what do you think the premium would be for each?

Was the quality of their information clear and did they answer all the questions? Which team won? Who were the weakest links and which apprentice/s fell victim to elimination?

Watch it here
Hear the verdict and what judge Simon had to say in episode three.

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