Menu

Reinsurance News

Credit insurers prepare for rising COVID-related claims in early 2021: Berne Union

26th October 2020 - Author: Charlie Wood

While claims activity is currently relatively subdued, many members of Berne Union have reported a marked increase in payment deferrals and pre-claim situations and expect to see COVID-related claims levels rising from early next year.

Berne-Union_logo_on-the-moveIncreasing corporate insolvencies and the wide economic recession are reportedly the biggest ongoing concerns.

Members also flagged particular vulnerabilities in the transportation sector – especially aeronautics and shipping – as well as retail, construction and product manufacturing.

In a Berne Union survey, 80% of members reported an increase in new demand, most commonly for short term credit and working capital products.

Around a third of respondents indicated that this includes a substantial increase in inquiries from new clients.

In terms of risk appetite, the majority of respondents (78%) indicated that they are either increasing (43%) or at least maintaining (35%) overall capacity, while most members are simultaneously decreasing limits for individual countries, sectors and counterparties.

Secretary General, Vinco David, explained that, “a combination of the natural claims cycle, and mitigating efforts from governments around the world means that COVID-related claims will not appear immediately. We do expect to see increasing claims in 2021, but exactly how much is still not clear.

“Many of the special government measures are set to expire by the end of this year. This may be a determining factor, as indeed will be the substantive course of the pandemic itself, which remains to be seen.

“The credit insurance industry continues to maintain capacity but is exercising prudent risk underwriting.”

Print Friendly, PDF & Email

Recent Reinsurance News

Getting your daily reinsurance news from Reinsurance News is a simple way to receive only the reinsurance industry news that matters, delivered directly to your email inbox.

  • Only email is mandatory, but the more you tell us about yourself the better we can serve you in future!
  • This field is for validation purposes and should be left unchanged.

By submitting the form you are giving your consent to be emailed by us.

Read previous post:
AccuRisk partners with Convex to offer Employers Liability insurance

AccuRisk Solutions LLC, has announced a partnership with Convex Group Limited (Convex) to offer Occupational Accident and Employer’s Liability insurance...

Close