Global business uncertainty remains over Tariffs and tensions in the Middle East and Central Asia.  Recent forecasts suggest that global business insolvencies could increase by 7% in 2025 after increasing 12% in 2024. 

On average, 1 in 10 invoices becomes delinquent, causing financial strain for businesses of all sizes. This continues to prove the importance of trade credit insurance as a financial safeguard.

The Rising Risk of Insolvencies and Delinquent Invoices

The economic landscape is seeing a steady rise in the number of businesses facing insolvency, driven by factors such as global supply chain disruptions, inflationary pressures, and escalating tariffs. This is particularly relevant for businesses dealing with international trade, where external factors such as tariff increases and political instability can exacerbate financial challenges.

Additionally, 1 in 10 invoices becoming delinquent means that businesses are increasingly having to manage outstanding debts, often leading to cash flow problems. When businesses fail to pay their invoices, suppliers are left vulnerable, and the risk of not being compensated for delivered goods or services grows.

In such an environment, businesses must take proactive steps to protect their financial health, including investing in trade credit insurance.

What is Trade Credit Insurance?

Trade credit insurance is a type of cover designed to protect businesses from the financial risk of unpaid invoices and customer insolvencies. It acts as a safety net, covering the majority of the invoice cost if your customers fail to pay for goods or services, due to financial difficulties or insolvency. This coverage ensures that businesses are able to maintain a steady cash flow, even when facing delayed or missed payments.

Tips to managing your cash flow risks

• Assess Your Exposure to Risk

Start by evaluating your business’s exposure to the risks of insolvency and invoice delinquency. This involves reviewing the financial health of your customers, particularly those in foreign markets, and understanding how susceptible they are to economic disruptions, including tariff changes. Consider how much of your business relies on credit sales, both domestically and internationally.

• Review Your Credit Limits and Payment Terms

Reassess the credit limits you extend to customers, especially those with whom you have a limited or volatile trading history. Tightening credit limits or shortening payment terms can help protect your cash flow while ensuring you don't over-expose your business to high-risk clients.

In light of global trade tensions, especially related to tariffs, consider requiring partial upfront payments or deposits for international orders to reduce your exposure to delinquent invoices.

• Monitor Your Customers’ Financial Health

Regularly monitor your customers’ financial stability and creditworthiness. Many trade credit insurers provide access to credit reports and monitoring services, allowing you to track any financial changes or signs of potential insolvency. In light of the forecasted increase in business insolvencies, keeping a close eye on your customers’ financial status will help you make informed decisions on extending credit and mitigating risks.

• Diversify Your Customer Base

Over-relying on a small group of customers can increase your vulnerability to payment defaults. Consider diversifying your customer base, particularly by exploring new markets, to reduce the impact of a single customer’s failure to pay. Expanding your business beyond any single market or region, especially those exposed to tariffs, can provide a level of protection and lessen the risk of your revenue stream being disrupted.

By taking proactive steps such as assessing your exposure, purchasing the right insurance coverage, monitoring your customers’ financial health, and working closely with your insurance adviser, you can minimise the financial impact of unpaid invoices and safeguard your business from the negative effects of increasing insolvencies and global trade challenges.

If you're unsure about the right trade credit insurance policy for your business, it’s a good idea to consult with an insurance adviser who can help tailor a solution to your specific needs and ensure you are well-protected.

General Advice Warning

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to be a constitute personal advice. We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular product’s features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.

Keeping occupiers and visitors safe is paramount for property owners and building managers.

Thermographic scans are essential early detection checks that can identify ‘hot spots’ in electrical equipment which can identify faulty electrical systems.

How do they prevent fires?

An annual scan as part of the routine maintenance can detect electrical hot spots, a sign of malfunction or overheating in key equipment that are likely to cause power outages, short circuits or fires. 

What is a Thermographic Scan?

Scans are undertaken by qualified professionals with handheld specialised cameras that capture infrared radiation (‘Hot Spots’). This is a non-invasive method used to identify and detect faults or potential issues in the wiring and electrical systems, including:

• Electrical Switchboards
• Motors including Bearings and Gearboxes
• Electrical Panels
• LV Equipment
• Transformers
• Power Factor Correction Units

Why Do You Need a Thermographic Scan for Your Building?

1. Safety of Tenants and Visitors

• The safety of people in the building is of paramount importance. The building and loss of rental income can be insured, preventing fires is a legal requirement as a PCBU for the safety of tenants and visitors.

2. Fire Prevention

• Electrical fires are one of the leading causes of property damage. Faulty wiring, overheating components, or loose connections can spark a fire if left unchecked. A thermographic wiring scan can detect hot spots before they turn into a major problem. By identifying areas at risk of overheating, you can prevent fires from starting and protect your property and rental income.

3. Reduced Downtime and Disruptions

• For commercial properties, electrical issues can lead to significant downtime, affecting daily operations. A thermographic wiring scan can identify potential issues before they cause power outages or disruptions. This proactive approach helps maintain the smooth operation of your building’s electrical systems and avoids unplanned interruptions.

4. Compliance with Regulations and Insurance Requirements

• Regular electrical inspections are required to comply with building codes and safety regulations. A thermographic wiring scan can form part of these inspections, ensuring that your building is in compliance. Additionally, many insurance policies require proof of regular electrical inspections, and failing to meet these requirements may affect your insurance cover.

A thermographic scan is relatively cheap when compared to a fire and potential for people being injured and damage to the building and loss of rental income. 

It is usually a requirement to meet local laws and regulations and also for insurance. 

Talk to your insurance adviser, they will be able to discuss your needs and assist with organising a thermographic inspection, if needed.

General Advice Warning

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to be a constitute personal advice. We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular product’s features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.

Vulnerability can be short or long term and includes issues related to age; disability; mental health conditions; literacy barriers; cultural background, etc.

Insurers and insurance advisers and assessors are required to treat this information, Confidentially, so it’s not shared with other unless it’s needed to assist you.

Vulnerable Person

Examples of Vulnerable persons might include people experiencing:

• Financial hardship: this can a result of a fire, storm or disaster or reduced income due to loss of work. 
• Family violence, Coercive Control: insurers can provide additional advice and work with you as needed.
• Disabilities: Physical or mental disabilities, let your insurer know, so they can work with you especially when making a claim. 
• Cultural, language or literacy: insurers are required to offer additional advice and assistance when you’re buying insurance or when it’s time to make a claim.

Let your insurer know about your Vulnerability so they can assist you.

Key reasons to advise your Vulnerable

Enhanced Claims assistance - You receive additional assistance as needed during the claims process, including priority assessing and repairs and claims assistance.

Insurance company & your insurance adviser - will work with you to assist as needed, revising premium payments, offering counselling or similar services to best manage the vulnerability. 

How to Disclose Vulnerability to Your Insurer

If you or a member of your household is vulnerable (even if you're not sure) let your insurance adviser or the insurer/ assessor know as soon as possible. 

Let them know your personal circumstances and how you are impacted, it doesn't matter if it’s temporary or permanent. For example, let the insurer know you live outside the nearest town or experiencing personal hardship due to a family matter or loss of income. 

If someone has a disability, explain how this affects their daily living. If you have elderly relatives at home, mention their age and any specific needs they may have.

Help if you’re Vulnerable

Vulnerability includes issues related to age; disability; finances, mental health conditions; literacy barriers; cultural background, domestic situation etc. It can be short or long term.

Talk to your insurance adviser, insurer and assessors if you think you’re Vulnerable, they will treat your information Confidentially and Empathically, also then can provide you with additional support and assistance.

General Advice Warning

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to be a constitute personal advice. We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular product’s features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.

At Insurance Advisernet, supporting organisations that make a tangible impact in the lives of vulnerable children and families is a core part of who we are. That’s why we’re proud to announce the IA Foundation recently donated $10,000 to Act for Kids, one of Australia’s leading child protection charities, to help fund their Gold Coast Flourish Program.

The Flourish Program provides vital therapeutic support to children and families on the Gold Coast who have experienced trauma due to abuse, neglect or harm. Delivered from the Rotary Community Hub in Labrador by a team of dedicated allied health professionals, Flourish offers trauma-informed and evidence-based interventions such as cognitive behavioural therapy, play therapy, and expressive therapies.

The challenges these children face are complex. Many are dealing with emotional distress, anxiety, behavioural concerns and peer isolation. Others are disengaged from school due to bullying or learning difficulties. On top of this, family stressors such as financial hardship, inconsistent caregiving or exposure to domestic violence can further impact their wellbeing. Flourish aims to address these issues with holistic, child-centred care that helps young people regain confidence, build resilience and start to thrive.

This is just one part of the broader impact Act for Kids has across the country. With more than 34 therapy centres and over 450 staff, the organisation provides integrated therapy, early intervention, family support, disability services, education programs, and care for children in crisis. In the last year alone, they supported more than 36,000 children and families, and in the past six years, their services have reached nearly a quarter of a million Australians in need.

Their purpose is simple yet powerful: to help keep kids safe, heal from trauma and lead happy lives.

The IA Foundation has been an ongoing supporter of Act for Kids for several years now, and we are continually inspired by the dedication and professionalism of their team. Our latest donation helps ensure that the Gold Coast Flourish Program can continue delivering critical services to the children who need them most and we’re incredibly proud to play a small part in that.

To learn more about the incredible work of Act for Kids or find out how you can support them, visit www.actforkids.com.au.

General Advice Warning

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to be a constitute personal advice. We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular product’s features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.

As the 2024-2025 financial year wraps up, small businesses across Australia are entering one of their busiest periods – and cyber criminals know it.

From lodging tax returns and reconciling accounts to implementing new superannuation thresholds and finalising payroll, it’s a time of high activity and, unfortunately, high risk. According to research from CommBank, one in four Australians have seen or experienced an EOFY scam, with the ATO reporting a 179% increase in scam emails and a 414% increase in scam SMS in just one year.

Why Tax Time is Prime Time for Cyber Attacks

Cyber criminals prey on the increased pressure and reduced vigilance many businesses experience during EOFY. Scams often include:

• Fake ATO or myGov messages with phishing links
• Fraudulent invoices that look like genuine supplier bills
• Payment redirection scams, often involving fake emails from familiar contacts
• Compromised cloud storage or email accounts
• Remote access support scams targeting you or your team

Many small businesses believe they’re too small to be a target – but the average cost of a cyber attack is $46,000. That’s a major hit to any business, let alone one already juggling year-end responsibilities.

Simple Steps to Strengthen Your Cyber Security

Protecting your business doesn’t require tech wizardry. Here are just a few quick wins:

• Enable multi-factor authentication on all key accounts
• Upgrade to passphrases and use a password manager
• Be suspicious of urgent requests for payment or information
• Stick to verified software and trusted IT support providers
• Switch to eInvoicing, which is safer than emailing PDFs

Importantly, ensure your staff are trained to recognise and respond to cyber threats. Cyber criminals are increasingly targeting not just business owners but also employees and even family members connected to your accounts. 

Need help protecting your business from cyber risks this EOFY?

Cyber security is a key part of any risk management strategy. 

Talk with your local insurance adviser about protection for your business and customers. They’ll work to provide the coverage at a cost to meet your needs, as you head into the new financial year.

General Advice Warning

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to be a constitute personal advice. We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular product’s features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.