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Introduction
Aon's Credit Solutions Chief Broking Officer reviews market dynamics and client trends
I am pleased to share our Q4 Insights from Aon’s global Credit Solutions leadership team which outlines the insurance market dynamics from 2022 as well as highlights some of the critical expectations for 2023. As emphasized in our discussion with carrier leadership back in July, the needs and applications of credit insurance are intensifying but companies require the right level of insights to i) design the right solution and ii) maximize the effectiveness of the solutions in place.
Claims are now back in the market after two years of benign conditions created by the government support measures introduced in the pandemic. Carrier results published through Q3 indicate high levels of credit limit capacity and appetite in the market together with healthy loss and combined ratios. However, frequency losses are now normalizing to pre-pandemic levels and the outlook for 2023 is marked by economic headwinds, heightened geopolitical tensions, and increased volatility. The economy is settling into a regime of “stagflation” and business insolvencies are expected to rise significantly.
In a recent Aon survey, 79 percent of C-suite leaders and senior executives expect a recession, though only 35 percent feel "very prepared" for it. In today’s liquidity crunch with rising interest rates and inflated commodity prices, the role of credit insurance has never felt more relevant.
Our 2022 Credit Solutions Conference brought together global subject matter experts, industry thought leaders, and senior decision-makers to discuss the credit solutions issues that are most pressing at this time, providing clients with enhanced clarity and confidence to make better decisions for sustainable growth.
Our solution spotlight illustrates how credit solutions can be tailored for both the buying and selling stakeholders of M&A transactions to i) lower the cost of capital, ii) facilitate off-balance-sheet solutions for transaction-related demands for collateral, iii) enable additional short-term financing, and iv) shorten the cash conversion cycle for individual assets and portfolios.
As always, our Credit Solutions team's role is to ensure every Aon client is better informed, better advised, and able to make better decisions around our products.
In case you missed it
In July this year, we spoke with four leading voices from the credit insurance market about the future of the industry.
Featuring insights from:
Anil Berry, Group Board Member at Allianz Trade
Andreas Tesch, Group Board Member at Atradius
Corine Troncy, Global Head, Trade Credit at AIG
Nicolas Garcia, Group Commercial Director at Coface
Stuart Lawson, Global Head Credit Solutions at Aon
Oliver Henderson
Chief Broking Officer
Aon's Credit Solutions