Berlin government considers offering credit insurance
The German government is considering offering credit insurance cover, as insurers pull out of the market, The FT reports.
In a letter to parliamentarians obtained by the Financial Times, the economics ministry said it was in talks with credit insurers to determine “whether there will be an offer of support from the state”. A decision would be made “in the coming weeks”.
The move would follow France’s decision last month to provide €5bn (£4.4bn) of state guarantees to companies.
Stephan Schweda, GDV insurance federation spokesman, said the volume of domestic credit insurance had dropped by €23bn in the four months to the end of March to €276bn.
One industry official said: “It is not the insurers’ business to insure a house on fire.”
A spokesman for the economics ministry said the government was “not about to enter the market for credit insurance directly”, adding that no decision had been made yet as to whether it could offer indirect support.
UK Chancellor Alistair Darling is widely tipped to announce government support for credit insurance in the UK in the budget this week.
