Credit insurance claims up 51% on year
Credit insurance claims increased 51% on year during the fourth quarter of 2008, the Association of British Insurers (ABI) revealed this week.
As the credit crunch began to bite, the number of claims increased to 8,366, compared to 5,540 during the same quarter in 2007, a rise of 51%.
The value of claims paid out by credit insurers such as Atradius, Coface, Euler Hermes, and Zurich rose 40% to £360 million, compared to £257 million in the year ago period.
Total value of turnover insured also increased to £302.5 billion, up 7% on year.
Nick Starling, ABI’s director of general insurance and health, said: “The latest rise in trade credit insurance claims, and the value of turnover covered, shows that insurers are playing a crucial role and continue to help their customers through the recession.”
In response to the figures, the ABI has released a new guide on how trade credit insurance works.
The guide explains how credit insurers operate, and what their customers should expect from them, including an explanation of how risk assessment decisions are calculated.
The ABI also released new advice for credit insurers on helping British businesses through the recession.
Proposals include committing to provide reasons, on request, when credit cover is withdrawn, and committing to help the maximum possible number of UK companies continue trading.
Starling said the advice to credit insurers “reaffirms the important role that insurers have in supporting businesses, especially small and medium-sized enterprises, during these turbulent economic times.”
Business Secretary Peter Mandelson recently criticised the credit insurance industry for ‘overreacting’ to the credit crunch by withdrawing cover from many businesses.
Category: ABI News, Companies News, Insurance News, Zurich News
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