Related News

TotalEnergies’ US$20bn Mozambique LNG project secures US Exim backing

UK Export Finance to grow defence lending to £10bn

World trade outlook defies Trump uncertainty, for now

Ukraine secures UKEF-backed loan for missile purchases

Trump announces pick for US Exim chair

US President Donald Trump’s protectionist trade policies will likely boost demand for credit insurance as firms grapple with non-payment threats, experts predict.

In its latest Export Credit Business Confidence Trends Index, the Berne Union industry association reveals credit and political risk insurers are anticipating a jump in demand for short-term policies.

The H1 2025 index is based on a biannual survey of more than 80 association members, which include private insurers, export credit agencies and multilateral finance institutions.

“While the bases for this optimism vary among providers, many agree that opportunities abound in supporting exporters amid a new wave of trade protectionism,” the report says.

“With looming tariffs from the current US administration, coupled with uncertainty surrounding their implementation, and potential retaliation from major trading partners like Canada, China and the EU, exporters may increasingly turn to credit insurance to mitigate risks to their trade assets.”

Trump promised to impose “obnoxious” tariffs as he prepared to take office, and has already slapped levies of at least 20% on all Chinese imports. He also announced last week significant tariffs would be applied to Canadian and Mexican imports, though largely withdrew the reforms a few days later.

The Berne Union index highlights a dramatic reversal in business sentiment among private underwriters of short-term risks, which in the previous survey expressed notable pessimism.

The index score for “expected demand” among commercial insurers has risen to 77.2, up from last year’s 37.5.

“Private insurers, who reported their strongest positive sentiment since the survey began, highlighted demand from banks as a key driver of future growth, although tempered by a slowdown in new corporate business,” the index says.

There is also optimism among medium to long-term (MLT) risk providers, a segment dominated by export credit agencies and multilateral insurers.

“Current demand is driven by a surge in defence transactions, especially in Europe, as countries ramp up defence spending, alongside infrastructure projects in developing nations,” the report says.

Last week, UK Export Finance (UKEF) agreed a £1.6bn deal to help finance exports of missiles to Ukraine. That came after UK Prime Minister Keir Starmer vowed to boost defence spending to 2.5% of GDP by April 2027.

But geopolitical tensions may also weigh down business in other sectors.

“Some caution that uncertainty surrounding the new US administration’s impact is delaying longer-tenor deals, as clients adopt a cautious approach to finalising this class of transaction,” the index says.

Denmark’s export credit agency told GTR earlier this year that Trump’s policies may impact US wind market deals, with the White House suspending new federal leases for offshore farms pending a review.

 

Rising claims?

While geopolitical tensions may offer a boon to commercial insurers, claims risks are also rising.

Commercial underwriters have a negative outlook in the short-term segment, registering an index score of 75.0 for expected claims.

Any figure above 50 indicates that insurers are expecting claims to rise in the coming period.

“Among private insurers, Germany emerged as the most frequently cited country for potential claims, where economic recovery remains elusive, with the European automotive industry, construction, and commodities identified as the key industries at risk,” the report says.

In the MLT segment, public insurers registered an index score of 46.2 for expected claims – indicating a stable outlook.

But “concerns persist” over deals involving sovereign borrowers, especially in West Africa, the report says.

“Senegal stands out, having recently experienced a double-notch downgrade following the self-imposed audit of the sovereign’s finances, while Angola, where the Ministry of Finance has increased borrowing in recent years, and Mozambique were also highlighted,” says the Berne Union.

Business relating to Russia, Ukraine and Sri Lanka was also frequently mentioned as continuing areas of concern, it adds.