Credit checking an agency - why?

[man]

For even the dodgiest sounding agencies, is there any real point credit in checking them if you have IPSE+? (looking at it purely from a financial perspective and ignoring the admin headache of having to chase the money).

If they fail, you're covered for up to £10K (insurance).
If they don't want to pay for work done you've got potentially £1K insurance cover for breach of contract straight off the bat, and then dunning / debt collection / small claims court for the rest (provided its under £10K).

I'm asking in case I've missed something!

[northernladuk]

What if you invoice monthly and paid 30 days in arrears?

Late payment isn't technically breach and if it is you've got to take it legal so that's not really in option. Your other options would come first before you get in to breach of contract.

You also use the caveat of under 10k a few times. So you know it can be over that.

[man]

What if you invoice monthly and paid 30 days in arrears?

Late payment isn't technically breach and if it is you've got to take it legal so that's not really in option. Your other options would come first before you get in to breach of contract.

You also use the caveat of under 10k a few times. So you know it can be over that.

Ah right, didn't realise that regarding breaches, thanks.

Yes, that's the reason I try to avoid agreeing those particular payment terms with any but the largest of agencies (and even then, if there's any other agencies working on the contract I'll try to use them instead). In my experience, a lot of agencies accept weekly/bi-weekly invoicing and 7 or 14 day payment terms if asked and that significantly reduces the risk as an IPSE+ member. I suppose in summary the bulk of the value of the credit check is if an agent plays hard ball over monthly + 30 days payments as you've mentioned above (at least one previous consultancy I worked with tried hard to push that because the end client would only pay their own invoices 60 days in arrears!)

That's why I keep referencing the £10K limit (i.e. it's for others that might not realise, with their monthly + 30 day agreements).

[SimonMac]

For even the dodgiest sounding agencies, is there any real point credit in checking them if you have IPSE+? (looking at it purely from a financial perspective and ignoring the admin headache of having to chase the money).

If they fail, you're covered for up to £10K (insurance).
If they don't want to pay for work done you've got potentially £1K insurance cover for breach of contract straight off the bat, and then dunning / debt collection / small claims court for the rest (provided its under £10K).

I'm asking in case I've missed something!

Read the T&C's carefully when it comes to IPSE if that is your only source of protection, although highly unlikely there are situations were a client goes under and you get nothing.

[northernladuk]

Ah right, didn't realise that regarding breaches, thanks.

Yes, that's the reason I try to avoid agreeing those particular payment terms with any but the largest of agencies (and even then, if there's any other agencies working on the contract I'll try to use them instead). In my experience, a lot of agencies accept weekly/bi-weekly invoicing and 7 or 14 day payment terms if asked and that significantly reduces the risk as an IPSE+ member. I suppose in summary the bulk of the value of the credit check is if an agent plays hard ball over monthly + 30 days payments as you've mentioned above (at least one previous consultancy I worked with tried hard to push that because the end client would only pay their own invoices 60 days in arrears!)

That's why I keep referencing the £10K limit (i.e. it's for others that might not realise, with their monthly + 30 day agreements).

I think you are looking at it all wrong. You don't driven like a pillock because you have car insurance or leave you valuables on show because you have house insurance?

Don't make business decision based on having insurance. Do the best job everytime and just have the IPSE+ in the back of your mind should the worst happen.