Over-redemption insurance

How to protect yourself against the financial risks of a promotional campaign?

Our over-redemption insurance is the answer!

WHAT TYPE OF CLIENTS CAN PROFIT FROM THIS KIND OF COVERAGE?

Promotional agencies, marketing agencies, the Fast Moving Consumer Goods sector, advertisers and/or distribution companies.

WHAT KIND OF RISKS DOES OUR OVER-REDEMPTION INSURANCE COVER?

In case you exceed the budget of a promotional campaign, i.e. in cases where a campaign is too successful, we will cover those increased costs for you.

WHAT ARE THE KEY ADVANTAGES OF OUR OVER-REDEMPTION INSURANCE?

• It enables you to fix the cost of a promotional campaign with more accuracy and a safety margin
• It allows you to spread the financial risk of a campaign
• It allows you to have more confidence in your campaign…
• …and thereby frees up other potential budgets

SOME OF THE STRATEGIES TYPICALLY USED IN THESE CAMPAIGNS:

• On pack: banderoles around the product; labels/stickers on the product or special packaging
• In pack: publicity inserted into the product
• Brochures
• Press
• Media
• Bulletins – leaflets
• Displays in shops
• Window displays in shops
• Spotters
• Scrolls or Banners
• Floor markings
• Activities offered by hostesses
• Street marketing
• Internet
• Mailing
• Display shelves
• …

WHAT TYPES OF OFFERS ARE THERE?

• Full refund (e.g. Your coffee is reimbursed 100%)
• Partial refund (e.g. Buy one get one free)
• Progressive refund (e.g. Buy 3, get one free; buy 6, get 2 free etc.)
• Mixed refund (e.g. Buy a sauce and get the pasta for free)
• Collecting (e.g. Collect points to win)
• Boutique (e.g. Collect points to receive an exclusive collectible item)
• On-pack discount vouchers
• Rain checks (e.g. a discount voucher for your next shop)
• Giveaways (e.g. Send us a questionnaire to enter a prize draw)
• Special promotions (e.g. buy a product that will be refunded if x happens)
• …

WHAT DO WE COVER?

We will cover up to twice the estimated take-up level. Example: If the client expects a 10% take-up, we cover between 10 and 20 %.

HOW MUCH WILL THIS INSURANCE COST ME?

The typical rate for this type of insurance is 13% (before tax and a fee of 11%) on the insured amount.

Example: Promotional campaign

• Retail price of the promoted product: 35€
• Suggested refund: 5€ + 0.5€ for administrative costs
• Expected takeup level: 10 %
• Items: 100.000

Insurance cover: 10% on top of 10% (expected take-up level)

Cost:

(100.000 x 5.5€ : 10 %) = 55.000 €

55.000 x 13% (taux) = 7.150 €

7.150 € + 11% taxes et frais = 7.936,50 €

Total cost for the advertisers, barring unforeseen events, of the promotional campaign covering up to 20% take-up: 50.000 € + 7.936,50 € = 57.936,50 €

WHAT ARE THE DUTIES OF THE CONSUMER TAKING PART IN THE CAMPAIGN?

The following documents need to be returned by the consumer:

Mandatory

• Ticket
• Barcode
• Comprehensive details
• Account number

Optional

• Terms&Conditions of the promotion
• Product in original packaging
• Completed questionnaire
• Feedback letter of 10 lines (handwritten)

This type of insurance allows you to comprehensively plan the costs of your promotional campaign. It also enables advertisers to start other campaigns without having to wait for the results of ongoing operations. Additionally, it allows advertisers to use greater numbers of products in their campaigns, as the financial risks are managed better. Vander Haeghen & C° have been underwriting this type of risk for many years and have accumulated great expertise in the sector across Europe.