Trade credit insurers face growing credit risk from Middle East conflict

The ongoing conflict in the Middle East is increasing pressure on trade credit insurance markets and weakening corporate payment behaviour, according to the Allianz Trade Global Survey. While global exporters continue to show resilience in their outlook, the risk environment has become markedly more fragile, particularly in relation to payment delays and default exposure.

Based on responses from 6,000 companies across 13 markets, the survey found that 75% of exporters still expect positive export growth in 2026. This indicates continued confidence in international trade performance despite heightened geopolitical uncertainty. However, this optimism is now accompanied by a clear shift in risk perception.

Geopolitical and political risk has become the leading concern for 65% of firms, overtaking supply chain disruption, which had been the dominant issue in 2025. This change reflects the growing influence of conflict-related instability on commercial planning and cross-border transactions.

From a trade credit insurance perspective, the most significant development is the deterioration in payment behaviour. Companies are experiencing longer payment cycles and an increased likelihood of non-payment, both of which directly affect insurers’ exposure and claims risk.

Since the onset of the conflict, the share of companies receiving payment within 30 days has declined from 10% to 7%. At the same time, the proportion of firms waiting more than 70 days for payment has risen significantly, from 15% to 24%. These changes indicate a broad shift towards slower settlement patterns across international trade.

Looking ahead, 43% of companies expect payment terms to worsen further. This represents an increase of five percentage points compared with pre-conflict expectations, signalling sustained pressure on working capital conditions. In parallel, 40% of firms now anticipate higher non-payment risk, an increase of six percentage points.

These developments are particularly relevant for trade credit insurers, as extended payment cycles typically heighten exposure to corporate liquidity stress and potential defaults. As a result, insurers face increased pressure to reassess credit limits and closely monitor the financial stability of insured counterparties.

Certain sectors are identified as more exposed to these risks, including pharmaceuticals, construction, and computers and telecommunications. The survey also notes that larger companies are experiencing more pronounced payment delays, suggesting that even firms with stronger market positions are not insulated from the broader deterioration in trade payment dynamics.

Key Survey Findings

Overall, the survey highlights a dual environment in which export expectations remain relatively strong, but the underlying credit risk landscape is deteriorating due to prolonged geopolitical instability.