Corporate Britain is getting riskier in the face of the lightning crashes of huge companies such as Enron, EULER Trade Indemnity chief economist said.
William Simpson was speaking after the credit insurer found profitability was down among UK firms.
A survey by EULER recorded the highest number of bad debts and company failures since the first quarter of 1994, the seventh consecutive rise.
Simpson said the biggest challenges included spotting individual companies at risk, rather than weak sectors.
"We are dealing with a much more worrying climate where even the big companies could be brought to their knees very quickly and ratings downgrades can start a spiral of death.
"It's not so much a sector problem - it's more about individual companies and the process of inflated company values."
Simpson said companies were under "relentless pressure" to boost productivity or cut prices.
This was the main cause of falling profits identified in the quarterly survey