Time is quickly running out to obtain favorably priced andwidely available trade credit insurance in Asia, said Marshinsurance brokerage.

“Trade credit insurance across Asia is in a much healthierposition compared to Europe and the U.S., with relatively lowprices and good availability of cover from local underwriters,”said Richard Green, head of Marsh's trade credit and political riskpractice in Asia, in a statement.

“However, we see the market tightening with rates increasing andcapacity shrinking in the fourth quarter of this year. This meansbusinesses should secure their trade credit cover sooner ratherthan later,” he said.

Trade credit insurance helps companies manage the risk ofcustomers' insolvency or payment default. It enables companies totrade on non-secure payment terms for account receivables, makingthem a more attractive trading partner for buyers.

From a buyer's perspective, it is better to transact with asupplier on an open account basis rather than have to provide aletter of credit or bank guarantee. Trade credit insurance allowssuppliers to offer unsecured payment terms without taking onincreased risk.

“At the moment, we are seeing a window of opportunity forclients, especially for Asian businesses dealing within Asia. Theintra-Asian trade continues to be more favorable while companiesdealing with European or U.S. counterparts will have more troublesecuring trade credit insurance,” said Mr. Green.

“We have seen an increase in claims costs, which means it's onlya matter of time before the premiums increase to reflect this,” hecontinued. Companies should take advantage of the 'sweet spot' themarket is currently in.”