Credit insurance premiums soaring

MUNICH: Credit insurers, including Euler Hermes SA, Atradius NV and Coface SA, have raised premiums by as much as 20 percent this year in Germany and may increase them more as defaults climb amid the financial crisis.

"Credit insurers have been scrutinizing their contracts very carefully" and raising rates, said Joerg Mielke, head of credit risk at the German unit of insurance broker Marsh & McLennan Cos in Munich. "They currently might feel like fire insurers when half of the world is on fire."

Claims on credit insurance, which covers against non-payment by customers, rose almost 54 percent last year, according to the German insurance association GDV. Payment defaults and delays in Germany more than doubled in the six months ended March 31 compared with a year earlier, Coface, a unit of France's Natixis SA, said earlier this month.