Credit insurers given a bad press but have changed the rules
Shaun Purrington, regional director of UK and Ireland at credit insurer Atradius, says credit insurers have had to rewrite their underwriting rulebooks, the Times reports.
Purrington, who is also chairman of the Association Of British Insurers’ (ABI) Trade Credit Committee, says credit insurers have had bad press.
“The quite exceptional events of the last year to 18 months, with the credit crunch and the economic slowdown, have meant that trade credit insurers have had to re-rate their models.
“As a result of that, we’ve taken some capacity from the marketplace. That has often been portrayed as a negative, particularly by the companies from which we’re withdrawing cover.
Paid claims not reported
“We stood by and paid claims and that doesn’t get reported. We paid claims to clients who would have failed if they hadn’t had credit insurance. Woolies would have dragged them down.”
“We had to take action incredibly quickly at times and, if there is one criticism I would take, it’s that maybe we didn’t take into account the precise trading characteristics of our customers. There just wasn’t time to do the job we had to do and protect them and take into account their different situations.”
Managing expectations
On Lord Mandelson’s credit cover scheme Purrington said: “I don’t think the Government managed expectations very well.”
In a detailed interview, he also details the difficulties credit insurers face getting information from companies about their business and accounts.
