Insurance Marketplace Realities 2023 – Trade credit

Rate predictions: Trade credit

	Trend	Range
Better risks		Flat
Poor risks		+5% to +10%

For stronger risks, underwriters remain very competitive with buyer-friendly pricing and strong limit appetite.

• Certain sectors are facing capacity issues even for good risks. A key example is the oil and gas sector, where both corporate clients and financial institutions are eager for trade credit protection.
• For weaker risks, non-rated or poorly rated portfolios, we are seeing reduced limit appetite and pricing increases in the upper single digits. Buyers in certain industries — retail, for example — can expect similarly tougher conditions.
• Overall, strong underwriting results, high demand from both corporate clients and financial institutions, and new entrants to the trade credit insurance marketplace will allow the trade credit insurance marketplace to offer competitive rates and limits as carriers work to retain and grow market share.

The expected claim-driven marketplace hit hasn’t struck yet.

• Insurers are advising the marketplace of their expectations for mounting claims and notifications of past-due accounts. Yet even as claims come in, insurers are indicating that combined ratios for 2022 will likely remain quite strong and show a strong underwriting result.

Banks are projecting significantly higher levels of credit insured accounts receivable funding.

• Accounts receivable funding facilities could see a significant increase over the 2021 period.
• This surge in such funding facilities will likely continue through H1 2023.

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