How to recover business debts
Authored by ARAG Underwriting Director David Haynes
The extreme economic situation that we’re experiencing has brought with it a host of commercial challenges.
Staff shortages, sharply rising energy costs and broken supply chains should be more than enough for any company to contend with, but the difficulty of recovering commercial debts is rapidly joining them on the list of top business headaches.
As belts and purse strings up and down the country are tightened, organisations are not just facing reduced income, but also customers who are slower to pay their bills and letting accounts fall into arrears.
Whether it’s bigger sums from a few large customers or an accumulation of smaller bills that might seem like too much trouble to chase, it’s easy for debt to mount up. Managing it carefully could make all the difference in surviving the economic difficulties that undoubtedly lie ahead.
Fortunately, ARAG’s commercial policyholders have access to a range of tools to help them manage and recover money owed to their business.
It’s useful to remember that every creditor is different, and their circumstances will change over time. Some may no longer be customers, while others may be important partners that have allowed a longstanding account to fall into arrears. Some may be managing a short-term cashflow issue, while others could be failing under the burden of mounting debt.
Sometimes, it can be hard to tell whether a client is unable to settle their account or simply unwilling. Equally, small business owners can often be uncertain about their legal rights in such situations and what steps can be taken to recover any money that may be owed.
The recovery of business debts is one of the common problems that legal expenses insurance was developed to assist, and there are some simple steps that ARAG policyholders can take to ensure the best chance of getting back any money owed to the business.
All of our business policyholders have access to the ARAG Legal website which contains some clever document building tools that owners can use to create the letters needed to follow the proper legal procedure to recover commercial debts.
If these are not effective, then policyholders also have access to ARAG’s legal helpline, which can provide advice about the specific situation they are facing.
ARAG’s commercial policies and schemes also have the option to include cover for contract disputes and recovering debts to the business. If a debt remains outstanding and there is a reasonable chance of recovering the money, ARAG can help those policyholders further, even if that means taking the matter to court.
ARAG UK is a specialist legal insurance provider and is part of the internationally recognised ARAG Group which serves 14 countries worldwide.
Providing several emergency assistance insurance products and an innovative range of Before-the-Event and After-the-Event legal insurance products and services, ARAG UK prides itself on its client-focused approach. This has been recognised by the industry following the results of the Insurance 360 Legal Expenses Insurers Study in which ARAG UK was voted 'best legal insurance provider'. youTalk-insurance sharing ARAG UK insurance news.
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