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Trade credit re-insurance scheme ends

The government has confirmed that it will end its trade credit re-insurance scheme at the end of June.

The decision has been criticised by the Confederation of British Metalworking (CBM), which says its members have received warnings from members that their cover will be withdrawn when the scheme comes to an end.  Insurers will no longer have short-term government guarantees.

The government says that the scheme has been a huge success, providing £210 billion in cover to more than half a million firms;  but that the economy is now recovering and the vast majority of firms will see their cover maintained or increased after the scheme end.  It is right that this is now done by the insurance industry, it says.

Another reason for the scheme ending, suggests a report in The Times, is that insurers disliked being required to seek government consent for bonuses to management linked to the areas of insurance covered by the scheme. 

Support was brought in a year ago after lobbying from the Association of British Insurers (ABI), supported by the Engineering and Machinery Alliance.  Insurers participating in the scheme include:  American International Group UK Limited; Atradius UK; Coface UK; Credendo; Euler Hermes UK; Markel International Insurance Company Limited; Nexus Trade Credit; QBE UK and QBE Europe; and Zurich Insurance.

The ABI supports the ending of the scheme.

Gov.uk source: https://www.gov.uk/government/news/update-on-the-trade-credit-reinsurance-scheme

If you have any problems around trade credit insurance and/or the ending of this guarantee, please let us know so we can pass them on to government.