Insurance Daily News

Credit insurance protects €9.58 trn of trade amid rising insolvencies

World trade covered by credit insurance reached €9.58 trillion in 2025, according to the International Credit Insurance and Surety Association (ICISA). This marks an increase from €9.25 trillion in 2024 and reflects heightened demand for protection in a climate of economic uncertainty, rising insolvencies and expanding cross‑border commerce.

Despite the absolute growth, the share of global trade covered by credit insurance fell from an estimated 15 % to 14 % between 2024 and 2025. ICISA attributes the dip to two main factors: trade expanding faster than global GDP and a 17 % appreciation of the euro against the US dollar, which compresses the percentage when trade is measured in dollar terms.

The World Trade Organization’s Global Trade Outlook (March 2026) reported a 4.7 % increase in goods and services trade in 2025, outpacing GDP growth of 2.9 %. When adjusted to constant‑dollar terms, ICISA says the coverage share would have risen by four basis points year on year, indicating underlying growth masked by currency effects.

Businesses are increasingly turning to credit insurance to manage counterparty risk, especially in markets where buyer information is limited and financing conditions are tight. ICISA’s Q3 2026 Business Sentiment Survey showed continued demand growth for both trade credit insurance and surety products, even as members remain cautious about claims and insolvency trends.

Global insolvencies rose 6 % in 2025 and are projected to increase another 5 % in 2026, according to Allianz Trade. This marks five consecutive years of rising defaults, prompting insurers and lenders to scrutinise credit extensions, particularly for firms with large trade receivable exposures.

ICISA members, representing roughly 80 % of global premium volumes, insured over €3.5 trillion of trade receivables in 2025. Private insurers supplied about 70 % of that cover, underscoring the commercial sector’s role in trade finance. Insured receivables are treated by banks as lower‑risk assets, improving both the availability and pricing of working capital for companies in strained sectors.

The gap between trade growth and coverage penetration is not solely a pricing or capacity issue. The ICISA metric relies on the proportion of world GDP made up of trade; as commerce expands faster than underlying output, the denominator rises, lowering the measured share. The euro’s strength against the dollar further masked nominal growth in coverage.

Geopolitical conflict remains a top concern for the credit insurance market, with both direct and indirect effects feeding into higher claim and insolvency risk. Nonetheless, the upward trajectory of insured volumes alongside a modest decline in coverage share suggests demand is outpacing penetration, pointing to a market that may need expanded capacity or new pricing models.

Overall, the rise to €9.58 trillion in insured trade highlights a growing reliance on credit insurance to safeguard cross‑border transactions, even as the proportion of total trade it protects narrows. Stakeholders will watch insolvency trends, currency movements and geopolitical developments for their impact on future coverage levels.

Why it matters

The expanding insured trade volume signals increasing reliance on credit insurance to sustain global commerce amid rising default risk.

FAQ

What was the total value of world trade covered by credit insurance in 2025?
ICISA reported that credit insurance covered €9.58 trillion of world trade in 2025.

How did the share of trade covered by credit insurance change from 2024 to 2025?
The coverage share slipped from an estimated 15 % in 2024 to 14 % in 2025.

What were the main factors behind the decline in coverage percentage?
ICISA identified faster trade growth than GDP and a 17 % euro appreciation against the US dollar as the primary reasons.

How many insolvencies were recorded globally in 2025 and what is the forecast for 2026?
Global business insolvencies rose 6 % in 2025 and are forecast to increase another 5 % in 2026.

Source: Insurance Business America. See the original source for full details.