New figures from the Association of British Insurers (ABI) show that nearly £36 million was paid in insurance claims to small businesses in 2015 equalling 25% of the total claims for the whole year. These claims were due to customer insolvency or late payments and with the growing economic turbulence and troubles, trade credit insurance is still providing the relevant cover and protection to small businesses against late payments and liquidation.
The figures released by the ABI show that trade credit insurance is continuing to offer small businesses good value. Many small businesses received a quarter of the total value of claims paid and pay around 15% of the total premium. In 2015, 4,400 claims were made against SMEs credit insurance policies, a 25% increase on the year before. More than 7,000 trade credit insurance policies were also taken out by UK SMEs, nearly 60% of all policies that were sold.
Mark Shepherd, ABI Manager for General Insurance said “Small businesses are central to the UK’s economy, innovating in the market and contributing to the country’s productivity. However, they can also be more vulnerable to financial setbacks, and customer insolvency or late payment can have a greater impact than it does for larger businesses. Trade credit insurers can play a vital role in helping small businesses through these challenging circumstances.”