Wednesday, May 30, 2012

Two Insurers Halt New Export Credit Cover for Greece

Wall Street Journal
May 30, 2012

Two of the world's biggest trade insurers said Wednesday they won't offer new insurance cover for exporters shipping goods to Greece as they find it increasingly difficult to price such cover amid worries that the country may quit the euro zone.

Credit export insurance ensures that exporters are paid if their client defaults. The loss of such cover is likely to have a major impact on the willingness of companies to trade with Greece, given the country's deteriorating economy.

Euler Hermes SA, a unit of Germany's Allianz SE, said its management board decided late Tuesday that it won't provide insurance for new exports to Greece "due to the recent economic developments and political uncertainties."

The suspension remains in place "until further notice." A company spokeswoman said it will continue to insure exports currently en route to Greece and domestic trade within Greece, fulfilling existing contracts.


No comments: