Export Insurance & Trade Services

Accounts Receivable Put Options


An Accounts Receivable Put Option is a credit risk management tool that provides protection against the risk of bankruptcy on the covered company. The holder of the A/R Put Option has the right to "put" their covered accounts receivable to the issuer of the A/R Put Option in the event of bankruptcy of the company on which the A/R Put Option is issued. A/R put options are not insurance and are issued by highly rated investment banks.

For Pricing on A/R Put Options

Call (337) 235-7548

Summary information on A/R Put Options:

  • Issued to cover large, publicly traded companies (or large private companies with audited financial statements)
  • Issued to cover one company (not multiple companies)
  • Issued by investment banks (not insurance companies), but are not sold through securities exchanges
  • Provides protection on 100% of the invoice amount (no deductible or coinsurance)
  • Only covers against the risks of Chapters 7 & 11 bankruptcy (does not cover for protracted default)
  • Cannot be cancelled by the issuer
  • Can provide protection on invoices with tenors up to 24 months
  • Will normally be issued only on face amounts in excess of $500,000
  • Compared to accounts receivable insurance
  1. More expensive - 0.25% - 2% of the face amount per month
  2. Often available when accounts receivable insurance is not
  3. No deductible and no reduction for co-insurance
  4. Non-cancellable (some insurance policies are issued as non-cancellable, but most give the insurer the right to cancel coverage on buyers with sufficient notice to the policyholder)

Following are just a few of the companies for which A/R Put Options were available, as of 4/10/2019.  A/R Put Options are available for companies in sectors, including retail, food & beverage, automobile, technology, metals & mining, industrial, energy, utilities, and telecom.

  • AutoZone, Inc.
  • Bed Bath & Beyond, Inc.
  • Best Buy Co., Inc.
  • Dillard's, Inc.
  • The Gap, Inc.
  • Gamestop Corp.
  • GoPro, Inc.
  • Guitar Center, Inc.
  • Hudson's Bay Company
  •  JC Penny Co., Inc.
  • Kohl's Corp.
  • L Brands, Inc.
  • Macy's, Inc.
  • The Neiman Marcus Group, LLC
  • Nordstrom, Inc.
  • Office Depot, Inc.
  • Petco Animal Supplies, Inc.
  • PetSmart, Inc.
  • Rite Aid Corp.
  • Toys "R" Usadio Shack
  • Rite Aid
  • Tesla
  • ​Dean Foods
  • Avis Budget Group