What to do when a claim arises?
Has the buyer not paid for your delivery, or is it refusing to accept it? This can make things difficult for you. To ensure it doesn’t get to that point, losses should be avoided or minimised. SERV can advise you on which measures you can take to avert loss, so that you don’t find yourself in a tricky situation.
Maintaining good relations with your customers and meeting all of your obligations for an export transaction are your main priorities. It is therefore important that you don’t hesitate – let us know immediately if you become aware of any breaches of duty by the debtor, any risk aggravating factors, or if an insured event occurs. After you have notified SERV’s employees, they will advise you on what to do next and agree the necessary measures with you.
What are the signs of imminent loss?
If your foreign debtor has started to neglect its duties – i.e. it is in breach of essential contractual obligations (e.g. it fails to pay an invoice) or is refusing to accept the goods – this can be a strong indicator of imminent loss.
Risk aggravating factors are another potential sign. This includes the following situations:
- A debtor is more than one month in arrears with their payments
- A debtor requests an extension of the payment period
- The financial situation of the debtor or the jointly liable third party (e.g. in the case of a guarantee by a parent company) changes or appears to be deteriorating
- Administration or liquidation proceedings are initiated against the debtor
Preventing or mitigating losses in three steps
- Make sure the terms are clear before signing a contract with a customer.
- You should let your SERV client advisor know right away if you become aware of any breaches of duty or risk aggravating factors (duty to notify).
- So that your client advisor can offer you the best possible support during this phase and you can work with SERV to avoid or mitigate the loss, you should not supply any further goods or services without checking with us first. It is important that we agree on the further course of action together.
More information about the entire indemnification procedure and claims management can be found in “Identifying risks and what to do in the event of losses”.
What should you do if an insured event occurs?
SERV defines a loss as the occurrence of an insured risk and the expiry of the waiting period. The waiting period is three months for insurance for exporters and one month for products for financial institutions, starting from the occurrence of the insured risk. No waiting periods apply for guaranteed events (e.g. counter guarantees).
Indemnification in three steps
- You must inform SERV’s claims department immediately of the occurrence of an insured or guaranteed event and provide all of the details.
- Applying for indemnification. The indemnification form can be requested from Claims & Recovery. Our employees in this department will be happy to help you complete the form. Please note that the form must be submitted within two years of the occurrence of the insured risk (forfeiture period).
- Upon receiving the indemnification request together with all of the necessary documents and information, SERV will review the application and inform you in writing if you are entitled to indemnification. If you are entitled to indemnification, the amount will be paid out to you within 30 days after the application has been approved by us.
Please remember that, even after indemnification, you will remain obliged to take recourse, recovery and loss mitigation measures in consultation with us. SERV may contribute towards the cost of certain measures (e.g. taking legal action). The information sheet contains detailed information about your rights and obligations if an insured event occurs, as well as information on SERV’s processes.
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