There were more insurance claims made across England and Wales to cover the non-payment of debts in the first quarter of this year than at any time since 2009.
That is according to data from the Association of British Insurers (ABI), which reveals that the number of claims jumped by 50% on the previous three months to reach 3,966
This coincided with a 13% increase in the number of corporate insolvencies recorded, with the collapse of construction giant Carillion having a far-reaching impact on businesses.
“This is a tough time to be in business and it is not getting any easier,” ABI assistant director, head of property, commercial and specialist lines,” Mark Shepherd, said.
“The collapse of Carillion dramatically highlighted how the ripple effect of a company failure can have a devastating impact throughout the supply chain.”
The ABI data is based on the records of trade credit insurers AIG, Atradius, Coface, Euler Hermes, Markel International, QBE, Tokio Marine HCC, XL and Zurich.
It was found that 44 new claims were made every day during the first three months of this month – the highest number recorded since the third quarter of 2009.
The value of domestic claims paid hit a record-breaking £54m, with no other quarter ever seeing that much paid out
Shepherd said the commercial environment remains challenging for customers, suppliers, and insurers, but that the latest figures highlight the safety net trade credit insurance provides
“Never has the importance of trade credit insurance been greater – the survival of any business could be at risk without it,” he continued.
“With too many firms at the mercy of non-payment of debts, the time has come for trade credit insurance to become an essential part of every businesses’ contingency planning.”