Remember to Report Past Dues and Be Mindful of the Maximum Extension PeriodWhen the Coronavirus first surfaced in China, we were wondering what the impact would be on the global supply chain and global payment trends. Here we are 4 months later and we are starting to see requests for payment extensions and increased payment delays which we are submitting to the insurers on behalf of our clients. Claims are highly likely over the next few months given the expected slowdown in the global economy. At this time, it is important to follow the policy conditions and communicate with the insurer when deviations from the policy language are required. Please make sure you are familiar with the past due reporting requirements of your policy, and submit those past due reports on a timely basis. Also, be aware of the maximum extension period under your policy. Most policies provide a 60 day extension period from the invoice due date to be paid by the buyer. Please familiarize yourself with the maximum extension period specific to your policy and if your buyer requires additional time, please let us know so we can arrange for the coverage with your insurer. If you intend to continue working with a delinquent buyer, the approval of the insurer must be obtained to accept deviations from the policy parameters prior to shipment or rendering additional services. We have already approached the insurers to let them know these requests will be coming and we anticipate different reactions from each of the insurers. Please remember to obtain documentation to support the sale including original signed contracts or purchase orders, sales order acknowledgement, proofs of delivery and bills of lading, copies of export licenses and any required export certificates and when possible written acknowledgement of the debt by the buyer once the goods are delivered or services provided. Taking the time to document the transaction will pay dividends when it is time to file a claim application. Whenever a potential claim arises, please contact our office so we can discuss how to expedite the claim payment process. We look forward to supporting you during these challenging times.
Posted March 16, 2020