Trade credit insurance: theoretical background and some international practices

Sokolovska, Olena (2016): Trade credit insurance: theoretical background and some international practices.

Abstract

The paper provides analysis of conceptual background of the trade credit insurance in the world. We analyzed briefly the problems, arising in insurance markets due to asymmetric information, such as adverse selection and moral hazard problems. Also we discuss the main stages of development of trade credit insurance in countries worldwide. Using comparative and graphical analysis we provide a brief evaluation of the dynamics of claims and recoveries for both short-term and long and medium term trade credit insurance in the world. For this purpose we used data on claims paid and recoveries for the period of 2005-2015. We found that the claims related to the commercial risk for medium and long trade credits in recent years exceed the recoveries, while with the political risk the reverse trend holds.

• Item Type: MPRA Paper
• Language: English
• Keywords: Trade credit insurance, export credit, international trade, international finance
• Subjects: F - International Economics > F1 - Trade > F10 - General; F - International Economics > F3 - International Finance > F39 - Other; G - Financial Economics > G2 - Financial Institutions and Services > G22 - Insurance ; Insurance Companies ; Actuarial Studies

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