Retail group says no improvement in insurers’ underwriting
The British Retail Consortium (BRC) has said the ABI code on credit insurers has not improved insurers’ underwriting and has demanded the government back-date its credit insurance scheme to April 2008.
The BRC's Quarterly Credit Conditions Monitor reports that more than half of large retail respondents said the reduction or withdrawal of trade credit insurance had hurt their business.
Of those, more than three-quarters said it had led to problems with up to a quarter of their suppliers.
When insurers started withdrawing cover
The BRC is calling on the Government to extend the date from October 2008 to 1 April 2008 – when insurers began removing cover as the downturn began.
Jane Milne, BRC business environment director, said: "Extending the trade credit insurance top-scheme will help, but we're calling on the Government to extend the scheme to last April – when the recession started to bite.
Codes not improving underwriting
"It's clear from the BRC Monitor that the majority of respondents are not confident of trade credit insurers' ability to assess risk accurately. The Association of British Insurers' Codes aren't improving underwriting – as they were meant to.
“The Government must put more pressure on these insurers to undertake proper research to ensure more accurate underwriting decisions."
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