Cover for your vehicle and the people you share the road with
Selling on credit helps your business grow, but an unpaid account can put pressure on your cash flow. Credit Takaful protects the money your customers owe you for goods or services sold on agreed credit terms. If a covered customer becomes insolvent, or fails to pay for longer than the period set out in your schedule, the fund pays the covered part of the debt, up to the credit limit agreed for that customer. Cover applies only to the price of what you sold; interest and late-payment charges are not part of it.
Kalkaal manages the participants' risk fund as Takaful operator for a disclosed Wakala fee.
To get started, send an enquiry. A Kalkaal advisor explains the cover, exclusions and contribution before you decide.
Why this cover
- Protection for your receivables if a customer becomes insolvent or stops paying
- A credit limit agreed for each customer, so you can see your exposure clearly
- More confidence when you offer credit terms to new and existing customers
- Cover limited to the price of goods or services, with no interest involved
Your contribution What you pay for your cover. Part of it is Tabarru’ to the shared fund.Glossary goes into a shared fund that pays eligible claims; Kalkaal manages the fund for a disclosed Wakala Agency: participants appoint Kalkaal to manage the fund for an agreed fee, disclosed in your quotation and schedule.Glossary fee.
Cover options
Whole Turnover Credit Takaful
Covers your credit sales to all eligible customers, each under a credit limit agreed with Kalkaal.
Key Customer Credit Takaful
Covers selected customers whose accounts matter most to your business, each under an agreed credit limit.
Export Credit Takaful
Covers credit sales to buyers outside the territory stated in your schedule against insolvency or protracted default. Available on request.
What’s covered
- Unpaid invoices when a covered customer is declared insolvent or bankrupt
- Protracted default: a customer who has not paid within the period in your schedule after the due date
- Credit sales of goods and services to customers with an agreed credit limit
- Debts for goods delivered or services completed under your agreed credit terms
- New customers added during the period of cover, once Kalkaal agrees their credit limit
- Sales to buyers outside the territory stated in your schedule, on request
Not covered and conditions
- Sales to customers above their agreed credit limit, or without one
- Disputed debts, until the dispute is resolved in your favour
- Sales to related companies, or to individuals buying for personal use
- Interest, late-payment charges and penalties
- Sales made after you knew the customer was in financial difficulty
- Overdue accounts not reported to Kalkaal within the period stated in your schedule
- Full exclusions, waiting periods and deductibles are set out in your quotation and policy wording.
ClaimsHow claims work
How to claim
- Report an overdue account to Kalkaal within the period stated in your schedule, even if you still expect payment.
- Stop further credit sales to that customer unless Kalkaal agrees.
- Keep chasing the debt, and keep copies of every reminder and reply.
- If the customer becomes insolvent, lodge your debt with the liquidator or administrator and tell Kalkaal.
- Tell Kalkaal about any payment you receive after you claim.
Documents you will usually need
- Completed claim form
- Copies of unpaid invoices, with delivery notes or proof of service
- The sales contract or order showing the agreed credit terms
- A statement of the customer's account
- Copies of the reminders and demand letters you have sent
- Evidence of insolvency, such as a court or liquidator's notice
- Details of any security held, payments received or goods recovered
What you’ll need for a quote
- Your trade licence or business registration
- Your yearly credit sales and normal payment terms
- A list of the customers you want covered, with the credit limit you need for each
- An aged debtors report showing current and overdue balances
- Details of any bad debts you have written off
- Your credit control procedure: how you check, monitor and chase customers
- Recent financial statements
FAQs
What does 'protracted default' mean?
Protracted default is when a customer has not paid a covered debt and the payment remains outstanding for longer than the period set out in your schedule after the due date, even though the customer has not been declared insolvent. Once that period has passed and you have reported the overdue account as your schedule requires, you can make a claim.
How are customer credit limits set?
You tell Kalkaal which customers you want covered and the credit limit you need for each. Kalkaal reviews information about each customer and agrees a limit, which may be lower than the one you asked for. Sales above the agreed limit are not covered. A limit can be reduced or withdrawn for future sales if a customer's position changes.
Does Credit Takaful cover interest or late-payment charges?
No. Credit Takaful covers the unpaid price of goods or services you have sold on agreed credit terms. Interest, late-payment charges and penalties are not covered, in line with Shariah principles. Your claim is based on the price shown on your invoices, less any payments, credit notes or recoveries.
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