Credit insurance

The credit insurance is a very special form of insurance that guarantees companies or banks against the borrower defaults occurred for reasons:

  • that are specific to these debtors (insolvency);
  • either subject to external constraints (notably political risk in export contracts involving customer credit). Here, credit insurance is one of the components of export insurance .

History

Private credit insurance

Credit insurance has grown since the end of the xix th century, but took off in Western Europe between the wars. Several companies are created in each country, some of which also manage the political risk of export insurance on behalf of the respective states, or the granting of bonds or guarantees.

In the 1990s, a major concentration of the sector saw the creation of three large multinational corporations that alone hold more than 80% of the world market:

  • Euler Hermes (formerly Euler Hermes SFAC) is the world leader in credit insurance with 34% market share and presence in 55 countries. The company is majority owned by the Allianz group .
  • Atradius , number 2 in the sector with 28% market share and presence in 45 countries. The majority shareholder of the company is the Spanish group Catalana Occidente.
  • Coface completes the top three with 20% market share and an extensive presence in 67 countries. Coface is a private company since 1994 which belongs to Natixis (41%). Coface also manages public guarantees on behalf of the French state.

Since then, other smaller players have appeared on the market:

  • Ducroire SA, active in credit insurance, issue of surety bonds and accepted reinsurance.
  • HCC International.
  • Axa Assurcredit, a subsidiary of AXA Group.
  • Groupama Credit Insurance, specializing in agribusiness.

Public credit insurance

In addition to private credit insurers, most countries also have public credit insurance systems, generally designed to cover the most difficult risks.

In France, Coface manages, on behalf of the State, public guarantees intended to encourage and support the international development of companies [ref. insufficient] . The Government has also deployed risk-sharing tools between credit insurers and the state. The CAP (Public Credit Insurance Supplement) comes under CAP, CAP + and CAPEXPORT 2 guarantees .

In Belgium , the National Office of the Ducroire (ONDD) assumes this role.

In the field of credit insurance and sureties, there are also professional associations:

  • The Berne Union is the leading international organization of public and private providers of export credit insurance and investment insurance.
  • ICISA: The International Credit Insurance & Surety Association brings together the world’s leading credit insurance and / or bond issuers.

References

  1. ↑ See the website of Public Guarantees  [ archive ]
  2. ^ Portal of the Ministry of Economy, Finance and Industry  [ archive ] .

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