EU sanctions imposed against Russia in response to the crisis in Ukraine pose new risks to the global economy, including the credit insurance market and the energy market.

Franck Le Vallois, Managing Director of France Assureurs, believes that economic activity in Europe could be undermined ‘owing to changes in the prices of energy and raw materials, thereby affecting insurance operations’(1).

Some analysts think that disruption to supply chains is also likely to increase the cost of repairing goods (and thus of insurance claims) but also, given commodity inflation, to put a strain on commercial insurers’ profits, as they usually get their premiums from corporate revenue(2).

The sanctions are now a top concern for private credit insurers, many of whom would be unable to cover outstanding payments on a number of transactions subject to Western sanctions. As a result, many European companies, although insured, could therefore incur significant losses(3).

What view does the Commission take of the potential repercussions of Western sanctions on the credit insurance sector?