Insurers consider withdrawing cover for builders

Credit insurers are considering withdrawing policies from construction companies amid concerns the sector could be the next to crash.

Insurers have warned that building materials groups are most at threat of cover being withdrawn, which could have a knock-on effect across the sector.

Shaun Purrington, director at credit insurer Atradius, told the Financial Times: “Construction is one of the sectors we feel very uncomfortable with.

“We could see good companies failing because they run out of money and liquidity.”

Credit insurance is critical for the industry as it protects suppliers against slow payments or defaults and mitigates the possibility buyers will not be able to pay for items already delivered.