About this issue's sponsor: XS Reserve
XS Reserve is a new approach to credit risk funding.XS Reserve is a new approach to credit risk funding.
XS Reserve is an innovative and flexible new product designed to support Treasurers/senior financial managers seeking to stabilize cash flow and reduce operating costs. By cash funding receivables volatility, XSR avoids the need for expensive standby liquidity facilities to cover bad debt losses. The insurance cover responds to losses as they arise up to the full contract value from day one, but importantly allows reserves to be developed without incurring the ‘sunk cost’ of ground up credit insurance cover, and so compliments AIG’s XOL cover.

The basic structure
  • Agreed level of reserve funded by monthly increments over a period of up to 3 years
    - Full loss payable from outset irrespective of funding to that date
    - Reserve assignable to third party (including bank/trade financier)
    - Reserve remains an asset in insured’s accounts (with lien to underwriter in        event of loss)
    - Cumulative balance reverts to insured subject loss experience over period
  • New approach to funding deductibles can also be applied to cover captive programme ‘risk gap’
  • Acts as alternative to standby LoCs
  • Enables enhanced advance rates on funding programs

  • Businesses can access a more cost effective XOL trade credit solution rather than pay away for the sunk cost of ground up cover, while still benefitting from immediate credit risk mitigation
  • Businesses don’t have to worry about finding emergency cash funds if they face unexpected losses falling within the deductible
  • Trade Credit XS Reserve can support businesses’ bank funding by providing banks with immediate cash collateral
  • Once the reserve has been built up it can be used to establish a captive for the business to serve other lines of insurance business

The product was designed by Alastair Malcolm who had previously created the concept of XoL credit onsurance. He and David McKibbin developed the idea to meet the growing gap created by the withdrawal of banks from lending and the provision of credit following the financial crisis.

For further information: www.xsreserve.com

Credit Insurance News Digests: Sponsorship
Sponsoring an issue of Credit Insurance News Digest is a great way to promote your company or brand to a committed audience of trade credit insurance professionals.
If you are interested in sponsoring an issue in 2015 see our sponsorship page for further information.
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