Latest ABI figures show that claims paid by trade credit insurers are running at over £4 million every week - their highest level since 2009
In 2017, trade credit insurers paid the most amount of money to help businesses get through challenging trading conditions since 2009.
That is according to figures published by the ABI today.
And after data from nine trade credit insurers showed company insolvencies were up 4% in 2017, UK firms continue to face challenging trading conditions at home and abroad.
The ABI’s trade credit report, called ‘Bad Debt Britain’, states that £225m was paid to businesses due to non-payment of debts, which is the equivalent of around £4m every week.
It also says the level of trade covered by trade credit insurance in the UK stands at a record £340 billion, up 7% on 2016.
The value of claims received in the last quarter of last year, at £130 million, was the highest quarterly figure since the first quarter, 2009. But the ABI says this is “unsurprising,” given the number of high profile insolvencies in the second half of the year.
Mark Shepherd, ABI’s assistant director, Property, Commercial and Specialist Lines, said:
“The failure of a number of high profile businesses, such as Monarch Airlines and Palmer and Harvey in 2017 and the recent collapse of Carillion, dramatically highlights the value of trade credit insurance. With over £4 million paid to businesses every week, trade credit insurance can make the difference between survival or demise following non-payment by a customer.
“The expertise of trade credit insurers is helping firms navigate challenging trading conditions, enabling them to expand at home and overseas, so helping Britain thrive.
“With the number of policies rising and insured trade at a record high, more firms are recognising that this cover is an essential business tool to help them assess the credit risk of potential business partners.
“But too many firms remain unprotected, and with intermediaries selling the vast majority of these policies, we need to raise awareness of the importance of trade credit insurance.”