As featured in our Autumn/Winter 2023 Political Risk Index, we
hear about the demand for credit insurance and the effects of
retail claims in Latin America.
The story so far
In Brazil, many companies collapsed during the pandemic. In some
cases, there were bankruptcy chains, where defaults of customers
bankrupted companies that were temporarily illiquid but otherwise
had good financial prospects. That experience caused a lot of
businesses to rethink their vulnerabilities. For most companies,
protecting assets is a key concern. In Brazil, receivables are on
average about 40 percent of assets, and yet in most cases, prior to
the pandemic, were completely unprotected.
After the pandemic, demand for credit insurance surged in Latin
America, because the value of the product had been made clear. That
said, in Mexico and Colombia, the development of the market was
hindered by the limited presence of carriers. In Brazil, there are
seven insurance carriers operating in
