Q&A with Paul Holroyd, Head of Trade Credit Europe at
Chubb
Chubb have been writing trade credit and political risks now for over 20 years, what does the future look like for the division?
Over the last 20 years we have evolved into a team which operates globally from 10 strategic trade and investment hubs. We work hard to stay close to our customers and the risks we insure, going forward we have ambitions to expand that global network at the right time. Technology is gathering pace within Chubb, we use AI in a number of areas across the wider group and we’re working on AI enhancements within our credit modelling which will bring efficiencies to our processes and that in turn will allow the team to manage a larger book of business. We are also focused on further diversification within our portfolio. There are no plans for Chubb to move away from our core Excess of Loss policy but within this product we want to ensure that we are continually reflecting changes in the credit market by offering our customers enhancements that will keep us best in class. As we’ve grown in size we haven’t lost our ability to be nimble and that is something we are determined to hold onto as we continue to build this business.
The consensus from most economists is that the credit environment is more challenged now than it has been for years, what’s Chubb view on those conditions?
Chubb’s view is largely consistent with all the other forecasts i.e. we are going into more difficult times. It’s essential that we reflect this within our policy structures and our overall approach to pricing risk. Chubb don’t have a ‘one size fits all’ strategy when it comes to negotiating terms, but generally our expectation will be that we need to reflect harder market conditions within our agreements. The one thing we are determined to do is continue to behave as a business partner. The non-cancellable nature of our policies exists to give our customers certainty of cover and if losses do occur then we’re ready to be responsive and to adjust claims promptly. We’re also making sure we are accessible to the buyers that we insure, we have good engagement with the key risks that we cover and we will continue to work with them to collect up-to-date information so that our credit limits are a fair reflection of the financial health of those companies.
So with those challenges in mind does it mean Chubb are changing their approach to underwriting?
As always we remain vigilant to the risks we are being asked to insure, but we have been through economic cycles in the past and have remained committed to our policyholders and stood behind the non-cancellable protection afforded by our policies. At the same time as being risk aware, we also believe there will be commercial opportunities for the product. We have seen instances in the past where our competition have pushed through wholesale changes in their risk appetite based on sector concerns, or more generally a desire to reduce exposure within certain risk categories, and depending on the merits of a case our proposition of a meaningful discretionary limit with non-cancellable cover should result in our product becoming increasingly relevant for policyholders’ who haven’t historically considered this approach to cover.
Chubb have been writing trade credit and political risks now for over 20 years, what does the future look like for the division?
Over the last 20 years we have evolved into a team which operates globally from 10 strategic trade and investment hubs. We work hard to stay close to our customers and the risks we insure, going forward we have ambitions to expand that global network at the right time. Technology is gathering pace within Chubb, we use AI in a number of areas across the wider group and we’re working on AI enhancements within our credit modelling which will bring efficiencies to our processes and that in turn will allow the team to manage a larger book of business. We are also focused on further diversification within our portfolio. There are no plans for Chubb to move away from our core Excess of Loss policy but within this product we want to ensure that we are continually reflecting changes in the credit market by offering our customers enhancements that will keep us best in class. As we’ve grown in size we haven’t lost our ability to be nimble and that is something we are determined to hold onto as we continue to build this business.
The consensus from most economists is that the credit environment is more challenged now than it has been for years, what’s Chubb view on those conditions?
Chubb’s view is largely consistent with all the other forecasts i.e. we are going into more difficult times. It’s essential that we reflect this within our policy structures and our overall approach to pricing risk. Chubb don’t have a ‘one size fits all’ strategy when it comes to negotiating terms, but generally our expectation will be that we need to reflect harder market conditions within our agreements. The one thing we are determined to do is continue to behave as a business partner. The non-cancellable nature of our policies exists to give our customers certainty of cover and if losses do occur then we’re ready to be responsive and to adjust claims promptly. We’re also making sure we are accessible to the buyers that we insure, we have good engagement with the key risks that we cover and we will continue to work with them to collect up-to-date information so that our credit limits are a fair reflection of the financial health of those companies.
So with those challenges in mind does it mean Chubb are changing their approach to underwriting?
As always we remain vigilant to the risks we are being asked to insure, but we have been through economic cycles in the past and have remained committed to our policyholders and stood behind the non-cancellable protection afforded by our policies. At the same time as being risk aware, we also believe there will be commercial opportunities for the product. We have seen instances in the past where our competition have pushed through wholesale changes in their risk appetite based on sector concerns, or more generally a desire to reduce exposure within certain risk categories, and depending on the merits of a case our proposition of a meaningful discretionary limit with non-cancellable cover should result in our product becoming increasingly relevant for policyholders’ who haven’t historically considered this approach to cover.
About this month's sponsor: Chubb
Chubb is the world's largest publicly traded property and casualty insurance company with operations in 54 countries and territories. Our 50-strong Political Risk & Credit team operates from key hubs around the globe.
Our trade credit products are backed by the security of Chubb’s financial strength; the highest among all private market trade credit insurers. As a matter of principle, we provide certainty of coverage for the period of the policy through non-cancellable credit and country limits, and we offer local, regional or central service according to requirements.
Our political risk insurance is designed to provide the broadest cover for many of the losses that could result from government action, political unrest and economic turmoil. Cover responds to the most common perils, namely expropriation and discrimination by governments, political violence and forced abandonment, inability to import/export and inability to convert or to transfer currency.
Find out more on chubb.com/uk-en.
Our trade credit products are backed by the security of Chubb’s financial strength; the highest among all private market trade credit insurers. As a matter of principle, we provide certainty of coverage for the period of the policy through non-cancellable credit and country limits, and we offer local, regional or central service according to requirements.
Our political risk insurance is designed to provide the broadest cover for many of the losses that could result from government action, political unrest and economic turmoil. Cover responds to the most common perils, namely expropriation and discrimination by governments, political violence and forced abandonment, inability to import/export and inability to convert or to transfer currency.
Find out more on chubb.com/uk-en.
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