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Trade credit insurers are continuing to review their exposure to Greece following news that the German export insurer Euler Hermes has cut its cover to the country.

“The insurers have of course been keeping a very careful watch on all of the Eurozone countries, but until this week’s announcements we have not seen insurers walking away,” Rupert Murray, broker at Arthur J Gallagher tells GTR.

Euler Hermes made the decision earlier this week to stop issuing new cover on Greece until the situation improves. Current shipments remain covered.

A spokesperson from the French trade credit insurer Coface tells GTR that it had been anticipating the situation with Greece for some time now but is currently maintaining cover on all financially sound Greek companies.

However, the insurer says it will not be providing any new cover on Greece, emphasising that this decision was reached over several months and was a “gradual process”.

Atradius’s official statement confirms that they were reviewing their exposure on an individual basis, but for now would continue to cover Greek risks.

“We are closely monitoring developments in Greece and assessing the default risk of every Greek company, case by case.

“We continue to cover reasonable risks on new supplies to Greece. Where we anticipate a very high likelihood of future payment default by a buyer, we reduce cover. But we continue to cover reasonable risks on many buyers.”

Will Clark, head of UK trade credit at Chartis Insurance, explains to GTR that the insurer is still supporting existing clients which have Greek exposure. But he notes that the concerns in the market are widening to other southern European countries as well.

“I don’t think the main conversation is solely about Greece it is about what happens after Greece and what’s the contagion effect,” he observes.

He sees new banking regulation curbing banks’ ability to lend at reasonable prices to corporates in Europe, preventing companies from generating economic growth.

“As it stands today these issues and the lack of a convincing economic strategy make the near future for Europe look uncertain and negative,” he remarks.

The trade credit insurance market came in for some criticism during the 2008-09 financial crisis for suddenly withdrawing cover on certain companies, with some arguing the decision provoked further insolvencies and forced many firms out of business.

Murray at Arthur J Gallagher argues that this time the market is assessing risks far more prudently.

“(Compared to 2008/09) a completely different approach is being taking by the majority of insurers – if it was not, they would have come out of the markets well before now. They are being much more analytical in their approach and looking at situations individually – they are not working on a carte blanche basis – they are looking at individual customers and individual policy holders before taking action.”