Improved global economic conditions lead to increased demand for trade credit insurance and surety
Trade credit insurance
- Insured exposure increased by + 11,9% to € 2.21 trillion ($ 2.47 trillion)
- Premium increased by + 2,95% to € 6.07 billion ($ 6.79 billion)
- Claims decreased by -/- 1% to € 2.85 billion ($ 3.19 billion)
- Claims ratio 2014: 46.9% (2013: 48.8%)
- Insured exposure increased by + 26.1% to € 331 billion ($ 370 billion)
- Premium increased by + 16.3% to € 2.71 billion ($ 3.03 billion)
- Claims decreased by -/- 13.6% to 1.02 billion ($ 1.14 billion)
- Claims ratio 2014: 37.8% (2013: 50.8%)
- Andreas Tesch (Atradius) re-elected President
- ICISA welcomed 5 new members since January 2014
- Number of members now 54
The members of the International Credit Insurance & Surety Association (ICISA) met in Toronto for their 73rd Annual General Meeting to share and discuss market and industry developments. The trade environment continuous to improve, but certain regions are not delivering as expected. Furthermore members identified risks threatening the recovery, such as the ongoing political unrest in parts of the world and the effects of sanctions on trade.
President Andreas Tesch:”The overall positive outlook for global trade is countered by disappointed economic outlook for countries such as Brazil and slower growth in China.”
During the Annual General Meeting the membership re-elected Andreas Tesch (Atradius) as President for 2015/2016 and Jos Kroon (Nationale Borg) as Vice President for the same period.
“The drop in average premium rate demonstrates the fierce competitive environment ICISA trade credit insurance members operate in”, Tesch notes. Comparing the current situation with the pre-crisis (2007) period, Tesch indicates that “members’ results continue to improve and exceed pre-crisis levels, with a 34.6% higher premium income and 29.1% higher insured exposure.” Tesch states: “An increasing number of companies, including a growing number of SMEs, recognize the benefits of the product as more than an insurance product. It facilitates access to bank finance and provides them with business relevant market knowledge assisting them to avoid large losses.”
Looking ahead to 1 January 2016 when the Solvency II regime will be effective, Tesch indicates: “The anticipated implementation of Solvency II is seen as the start of renewed negotiations for the industry.”
“The decreased claims figure reflects the overall improved market situation also for construction companies and the transportation sector”, Jos Kroon, Vice President of ICISA, explains. “Comparing the 2014 surety results with those from before the crisis (2007), premium income has more than doubled, while the insured exposure grew by almost 85%”, Kroon adds.
Members re-elected Andreas Tesch as their 39th President and Jos Kroon, CEO of Nationale Borg, Vice President. Furthermore Munich Re and The Guarantee Company of North America were elected as members of the Management Committee, which now consists of Atradius, Coface, Euler Hermes, Lombard, Nationale Borg, QBE, Munich Re and The Guarantee Company of North America. Tesch expressed his thanks to SCOR and to Zurich for their support and guidance during their three year term as member of the Management Committee.
The meeting focused furthermore on the future strategy of ICISA and a mandate was given by members to enhance the association’s role as data and knowledge center. Rob Nijhout, executive director of ICISA notes: “Growing the membership by 10% since last year is a welcome confirmation of the relevance of ICISA to the industry as platform for sharing knowledge and as representative industry body for the members. A closer cooperation with colleague associations within our industry forms a part of the reconfirmed strategy.”
Source: ICISA Press Release