Euler Hermes Canada
Simplicity
FAQs
What is Euler Hermes Simplicity?
Simplicity is a credit insurance solution from Euler Hermes that provides small businesses with the ability to mitigate their
receivables risk—quickly, simply and affordably so they can grow with confidence. A Simplicity policy offers easy-tounderstand, fixed pricing and can be issued within about a day, making it easy for your business to purchase and administer.
With a direct line to the Euler Hermes proprietary database, your Simplicity policy allows you to leverage the
power of our global team of risk experts so you can make informed trading decisions that will protect your cash flow.
What does the Simplicity policy cover?
Euler Hermes Simplicity covers all domestic and foreign buyers (on the
list of covered countries) against bankruptcy and slow payment losses.
Should one or more of your covered buyers fail to pay, the policy covers
60% of the debt, up to the maximum liability per customer and the
Annual Maximum Liability of the policy listed in the pricing table below.
You also have the option to request enhanced coverage, which utilizes
Euler Hermes proprietary risk ratings to assess the creditworthiness of
individual buyers. Approved and enhanced buyer limits cover 90% of
a bad debt loss. Where feasible, we always recommend that you take
advantage of our proprietary database and risk ratings to establish
the up-to-date credit-worthiness of your customers. In addition to
receiving higher coverage amounts, this information also provides
actionable insights about your debtors’ creditworthiness.
Do I get coverage on all customers?
Yes. With Simplicity, all of your customers are covered from day one at
the basic 60% coverage rate as long as they are not already in a pastdue situation. Because the policy doesn’t require individual buyer credit
limits, your basic coverage cannot be withdrawn during the duration of
your policy as long as the buyer doesn’t go more than 60 days past due.
Can I get extra coverage on a buyer?
Yes. If you want to increase your coverage on a buyer beyond the basic
60% level, you can request enhanced coverage of 90%. Requesting an
enhanced limit is fast and simple using your online policy management
portal, EOLIS. Decisions on enhanced limits are based on the Euler
Hermes Grade on a scale from 1 (very low risk) to 10 (insolvent).
Based on your buyer’s grade, we provide the following coverages:
GRADE 1 – 6
We increase coverage to 90% of the debt and multiply
the buyer maximum liability by four times (see pricing
chart on next page).
GRADE 7
Coverage stays at 60% up to basic coverage
(see pricing chart on next page).
GRADE 8 – 10
We do not recommend selling on open credit;
no coverage is provided for future sales to these
customers once a grade 8, 9 or 10 has been received.*
*Basic coverage is also excluded once you receive a grade of 8, 9, or 10.
How much administrative work is needed?
Very little. One of the major benefits of Simplicity for small businesses is
that your policy enhances your credit resources rather than burdening
them. Once your policy is initiated, your responsibility is limited to
submitting optional requests for enhanced coverage and filing a
claim in the event of a loss. However, many clients find that Simplicity
increases their credit function efficiency, eliminating the need for extra
personnel and third-party credit data to approve customer credit limits.
Can my coverage change throughout the policy?
Yes, you can request enhanced coverage on any buyer throughout
the year. Also, the customers for which you have enhanced coverage
are monitored on an ongoing basis, and the risk grade can change.
This means that as your buyers’ creditworthiness changes, the risk
rating could go down or up, which in turn could increase, decrease or
eliminate coverage for future shipments. Should coverage be reduced
or cancelled, you will still have a 30 day window through which your
coverage will remain in effect.
How much does Simplicity cost?
How does claim filing work?
Simplicity offers fixed pricing in bands depending on your sales volume. In
the chart below, select the column that matches your annual sales revenue
from credit sales, then scan across, and there’s your premium. It’s that simple.
Filing a claim is a fast and easy process through our online system,
EOLIS. Once you have submitted the claim form and provided basic
documentation to document the loss, we will send you the amount
owed to you under the policy within 60 days.
Your Annual
Sales
Annual Policy
Maximum
Liability ($)
Buyer Maximum
Liability ($)
Basic
Coverage
Enhanced
coverage
Premium ($)
(excluding
insurance tax*)
100,000 to
600,000
60,000
6,000
24,000
5,425
600,001 to
1,200,000
90,000
9,000
36,000
7,650
1,200,001 to
1,800,000
120,000
12,000
48,000
8,850
1,800,001 to
2,400,000
150,000
15,000
60,000
10,920
2,400,001 to
3,000,000
180,000
18,000
72,000
12,960
3,000,001 to
3,600,000
210,000
21,000
84,000
14,520
3,600,001 to
4,200,000
240,000
24,000
96,000
15,990
4,200,001 to
5,000,000
280,000
28,000
112,000
17,480
* An $800 service fee will be assessed annually.
How do I pay for the policy?
There are three easy payment options:
◾ Prepay with a check or wire transfer.
◾ Prepay via credit card on our secure website, which will incur a
$120 convenience fee.
◾ Set up monthly or quarterly withdrawals from your bank account
through our secure website, which will incur 8% simple interest.
Are the rates negotiable?
Simplicity is an off-the-shelf solution for small businesses and offers
simple, fixed pricing and set coverage that can be issued within about
a day. For that reason, rates are not negotiable.
What assurance do I have that my claim will be paid?
Euler Hermes is the oldest and largest trade credit insurer in the world,
having an investment-grade rating (AA- S&P, A+ AM Best) accepted
by corporations and banks across the globe. We cover over $1 trillion
in transactions annually and pay 85,000 claims each year. Our market
position is further backed by the financial stability of Allianz, one of the
largest insurance companies in the world. Our dedicated claims and
collections units handle claims quickly and efficiently to take the worry
out of managing unexpected default. You can rest easy knowing that
when your customer won’t pay, we will.
For Example:
If you have a Buyer Maximum Liability of $21,000 and an insured
percentage of 60%, and then submit a claim for $40,000 of
overdue invoices that we are unable to collect, the claim would
be calculated as follows:
We first apply the insured percentage: $40,000 @ 60% = $24,000
As this is above the Buyer Maximum Liability of $21,000, we would
pay a claim of $21,000 (assuming the Annual Policy Maximum
Liability is not breached).
Also, if you file a claim and we are able to recover money from the
debtor, a nominal collections fee will be charged on any uninsured
portion of the debt that is returned to you.
What if I have more than $5 million in annual sales or I
need a larger policy/buyer maximum liability?
If your sales exceed $5 million per year, or if you have very large credit
exposures, you may be better served by a traditional credit insurance
policy. Visit www.eulerhermes.ca or call 1-877-909-3224 to schedule
a consultation with a Euler Hermes representative.
How do I get started with Simplicity?
Getting started with Simplicity is easy. On the pricing table, choose the
most appropriate line that matches your expected total sales volume
for the coming year. If you need a higher Annual Policy Maximum
Liability or Buyer Maximum Liability, you may select a line with a higher
level of coverage. Whichever line you select will match up with a policy
premium amount for that year.
We also recommend that you read the Terms & Conditions of the
Simplicity policy and complete the application and Direct Debit forms,
which you can fill in online or download from
www.eulerhermes.ca/en/simplicity.
That’s It! Once the application has been processed, you can trade with
confidence.
For more information, visit www.eulerhermes.ca/en/simplicity
or contact simplicityCA@eulerhermes.com.
Euler Hermes Canada 1155 René-Lévesque Blvd West, Suite 2810 Montréal (Québec) H3B 2L2 Phone: +1 877 509 3224 contact.ehcanada@eulerhermes.com www.eulerhermes.ca