In the industry I work for, we often take out debtors insurance against some of our larger customers... Just on the off chance that they may go broke down the track. They cover us for about 80% of the customers outstanding debt at any one time and for every order that the customer places with us, the insurance company takes a very small percentage of the total invoice. We have strict rules in that the insurance company must agree to the customers credit limit and that we should always keep the customer within the bounds of that limit and that they should always pay us on time.
In theory, if, later that customer should fold then we pay an excess to the insurance company and they then pay us 80% of what we are owed.
In practice, we do all of the above and hold up our side of the bargain and then once a customer folds and we make a claim, the insurance company does everything within it's power to make our lives a living hell.
They ask for every single bit of information we posses on that customer, from emails dating back several years to invoice and files and whatever else we can provide. Then it takes them months to trawl through all of that information looking for any sort of tiny inkling of a hint that we may have done something wrong and they may be able to back out of paying the claim. Even when they can't find anything untoward, they generally accuse us of doing something wrong anyway, just on the off chance that we may decide that dropping the claim is easier than having to argue with them.
From what I understand, even in the NRL, insurance companies operate using a similar method... Making a claim and having it paid is tougher than climbing Everest on one leg carrying a midget on your back.
