How is the protection framework defined?

The protection framework is an essential element of the Buyer Protection and is therefore a necessary prerequisite for being awarded the trustmark. It determines the maximum financial volume of active protection that can be claimed by your clients at any one time. In particular, this article aims to answer the question of how the protection framework is defined and what you can contribute to this process.

If you would like more information on the subject of the protection framework, you can find it in this article: What is the protection framework?

What is the process for defining the protection framework?

Since your shop can only carry the trustmark if you have an active protection framework, the initial allocation of your protection framework is carried out at the beginning of your membership. In this step, Trusted Shops works together with the credit insurer Atradius, which, in partnership Trusted Shops, vouches for the safeguards provided by the Buyer Protection. As a rule, we use the following formula to define the protection framework:

Your stated online annual turnover: 12 : 3

The annual online turnover you provide during your registration is the basis for calculating the protection framework. We will first divide your online annual turnover by 12 to get the average monthly turnover you generate online. This is explained by the fact that your customers can take advantage of the Buyer Protection for a standard period of 30 days, i.e. approximately one month. The rate of the protection framework is therefore based on your average monthly online turnover. We additionally divide this value by 3 to include the presumed use of Buyer Protection by your clientele under the definition of the protection framework.

The initial protection framework for each member is usually 5,000 euros. Among other things, this value shows that the formula given is only a rough guideline. Your protection framework is not calculated to the cent. In addition, in view of the significant default risk, the protection framework for companies with high sales and companies operating in industries with high merchandise values is determined using individual criteria. Sometimes more information about your business is needed for this. If this is the case, we will contact you.

What happens after the allocation of the protection framework?

We will inform you about the size of your protection framework by e-mail, as soon as your shop has successfully completed the certification.

Of course, the protection framework communicated in the e-mail is not set in stone for the duration of your membership with Trusted Shops. After all, your business is evolving, so hopefully your sales will increase over the years. In the short term, seasonal effects or successful advertising measures can also lead to a jump in sales. As a rule, such developments also increase the number of Buyer Protection agreements, so that the protection framework initially estimated may not be sufficient.

First of all, the most important thing is that even if this is the case, your customers can of course continue to claim the Buyer Protection. When seasonal highlights, such as Christmas or Black Friday, can be foreseen, we will also pre-emptively adjust your protection framework. You will only be informed of this if your cooperation is required.

The situation is different, for example, if your business figures change significantly or the existing protection framework is exceeded consistently or regularly. In these cases, we will work together with Atradius to provide a long-term increase in your protection framework. Should we need further information from you, we will contact you promptly. If processes for checking and securing your credit standing are needed, these will naturally not be visible to your customers. We only communicate about this directly with you.

Was this article helpful?

1 out of 1 found this helpful