Business is always easier when there is confidence and security – and trading with firms that can’t pay their bills is something that puts the health of many companies in jeopardy. This is why risk underwriters play such a vital role.
“My job is to help give customers confidence so they feel empowered to make informed trade finance decisions,” says Shakeel Khan. He is one of 37 risk underwriters who work for us across the UK and Ireland. Underwriters work in teams, each with their own area of expertise, from construction to retail.
“This is a people business, so it makes sense that we work hand in hand with our customers. It’s my job to communicate the level of risk we’re taking for the premium they pay and the reasons for it. We keep a close eye on buyers and, if we feel the risk increases, we update our customers so they can continue to trade with confidence. In these days of retail collapses, our services are required more than ever.”
The process begins when a risk analyst grades potential buyers after gathering and analysing all the relevant financial data, including their payment history. Underwriters like Shakeel then ensure that they’re happy with the risk and the amount that Euler Hermes is covering.
“We get applications from customers every day – it might be a request for a million pounds on a certain company,” says Shakeel. “So I’ll look at our risk appetite on that company, assess the factors and then make a decision.”
Sharing the risk
We will typically indemnify 90% of a risk. Shakeel explains: “As with all insurers, we expect our customers to act in a prudent manner, as if they were uninsured. Sharing some of the risk with them is an incentive to do so and also to ensure they are covered under the terms and conditions of their policy.”
“We always approach our relationship with our customers as a partnership. We share our information but also value enormously the information they give us, as they often have a strong relationship with their customers. Sharing the risk is one of the things that reinforces our partnership with clients.”
Shakeel says the real test of any underwriter is when they can’t cover the sums the customer wants or if we have to decline a request. “That’s the biggest challenge because it puts pressure on our relationship with the customer as it means they will need to reassess their trading plans – whether it’s adapting their terms of payment or even stopping trading with a particular company. Nobody wants to hear bad news but we have to operate on the basis of the risk. Even when customers aren’t happy with the decision, we want them to know exactly why we made it. Even in this risky environment, I still look for reasons to underwrite rather than reasons not to.”
The perks of the job
“I love meeting people, I always have,” says Shakeel. “Visiting customers means I get a feel for the workplace and what they do there. I’m able to understand exactly where the customer is coming from so that when they make an application on a buyer, I understand the reasons behind it.”
Shakeel has worked for Euler Hermes for more than 10 years and before that worked as a lending or relationship manager in the banking industry, so he’s well suited to a role that combines finance with communication skills.
As an experienced underwriter, he has a sound knowledge of the technical skills required for his role. “These days, any training I undertake relates to communication,” he says. “Our key aim is customer centricity, which means maximising the time you spend understanding the customer. When you get to know the customer, your job is that much easier.”
“Some customers like to have succinct bullet points, others like to have the background information before you inform them of your decision. Everyone is different but the fundamental skill you need is solid communication.”
Getting to know our customers
“My day-to-day is very varied. I might be video-conferencing with colleagues, alternatively I might be on the road visiting a customer with one of our commercial managers,” says Shakeel.
He regularly visits customers to see how their business is doing, find out any challenges they’re facing and get to know their business strategy. “I’ll talk about how we see things on a macro-economic level before we move on to specific covers and buyers.”
“I also have risk and commercial contacts all over the world – from Singapore to Hong Kong and India. Globalisation means I can be talking to a risk underwriter in America or Asia just as easily as one in the UK.”
For Shakeel, the ultimate driver is getting to know our customers. “That’s the job of a risk underwriter. You’re not here to sit at a screen all day. It’s to go out and talk to customers, understand their business and provide value for them.”