Italy's eyewear manufacturers now have the means of insuring themselves against the risks of non-payment by their clients. On May 8, their trade association, Anfao, signed an agreement with Marsh, one of the major insurance brokers in the world, to get their merchandise insured from the moment they are picked up at the seller's factory to the moment they arrive at the buyer's premises anywhere in the world. Even more important, the insurance policy covers the manufacturer for non-payment, no matter whether the client is already bankrupt or whether it goes into receivership after the sale is concluded.
The convention is not revolutionary in itself, except for the fact that it will provide the policy-holder wih on-line access to a databank, put together by the insurance company, that will contain the names of over 20 million firms in Italy and overseas, listed with an individual up-to-date rating of their payment record and their ability to pay in instalments import orders of over 20 million lire (e100,000). Suppliers will thus no longer have to go through lengthy procedures to find out how reliable a new client is - you simply enter the firm's name, and the information comes up on the screen. The system is flexible enough to avoid black-listing a reliable client who may be going momentarily through a difficult time.
Protection from these risks is extremely important for small and medium-sized producers, who are frequently confronted with sizeable orders from unknown clients, often from overseas. The databank can also be a useful instrument for producers to identify potential foreign customers who will be in a position to pay their bills. The larger manufacturers are generally well insured, and have subsidiaries, agencies and representatives overseas that can identify risky customers.
The cost of the new policy, for those wishing to subscribe, will be a percentage of the supplier's turnover, with a discount or a premium depending on the frequency of its previous claims. Marsh belongs to MMC, a multi-national public group with a turnover of more than $9.2 billion in 1999.