Greece frozen out as insurers cut cover for exporting to Athens
TWO of the world’s biggest trade insurers, Euler Hermes and Coface, have suspended cover for exporters shipping to Greece amid fears the debt-laden nation could be forced out of the euro, hindering Greek importers’ ability to pay their bills.
“Euler Hermes has decided no longer to cover deliveries to Greece for the foreseeable future,” a Euler Hermes spokesman told Reuters yesterday. Coface also made a similar disclosure yesterday.
In both cases, contracts already in force will be honoured, but no new Greek business will be underwritten.
Euler Hermes, which insures exporters against the risk of not getting paid, had warned last week that it might restrict cover for Greece-bound exports.
The company, majority-owned by German insurer Allianz, insured export deals worth €702bn last year, making it the world’s biggest trade insurer after Atradius and Coface.
The move follows a similar decision by major European broker Newedge, which is co-owned by Credit Agricole and Société Générale, to scale down its exposure in Greece by refusing to take on any new business in the country. It will continue to cover existing business, however.