The collapse of UK Construction giant Carillion will cost insurers about 30 million pounds in payouts to suppliers of firms with trade credit claims.
Carillion collapsed on January 15th, claiming insolvency with at least 2.2 billion pounds in debt and pension liabilities, and leaving an estimated 1.2 billion in unpaid bills to subcontractors, the BBC reported.
The insolvency of the UK’s second largest construction firm has sparked fears of a domino effect on the hundreds and thousands of subcontractors.
Mark Shepherd, assistant director at the Association of British Insurers, which released the payout estimates, said; “one insolvency can risk a domino effect to hundreds of firms in the supply chain,” – highlighting the importance of trade credit insurance to protect against business interruption risks.
