led to a decrease in ships’ market value. This and a trend towards larger ships, carring more cargo or less cost, might also eplain the lower longrun response o hull premiums to trade relative to cargo premiums. ™ongrun premium growth orecasts are sing an eternal orecast or gloal real € growth, Tale 1 presents two scenarios highl dependent on the uture path o or average real growth rates o cargo and hull premiums over the net 10 ears‚ tradeto € ratio. an upside scenario in which trade is assumed to grow twice as ast as € as during the period etween 1ƒƒ0 and 200„… and a downside scenario in which trade is assumed to grow at the same pace as gloal €. †rom these scenarios, cargo premiums are orecast to grow on average etween 2.‡ˆ and ‡ˆ, and hull premiums etween 2.2ˆ and ‰.‰ˆ. Šhile shortrun prospects o marine premiums are mainl driven the development o premium rates, long run prospects are highl dependent on the uture development o the tradeto € ratio. Trade credit insurance23 “igher eports tpicall lead to an sing historical data rom ‰0 countries, an evaluation was conducted o the eect increase in trade credit insurance o eports on trade credit insurance premiums. The analsis estimates that a 1ˆ premiums. increase in eports is accompanied a 0.6„ˆ increase in trade credit insurance premiums. Trade credit insurance protects sellers o products and services against the risk o nonpament the uer. ‹ince this also includes domestic uers, eport data onl capture a part o the eposure to nonpament. The rest o the eposure depends on the development o the economic activit within a countr, which in turn also aects trade. Œter controlling or these eects Žie, keeping the level o gloal economic activit constant‘, the analsis shows that a 1ˆ increase o trade results in a ’ust 0.32ˆ increase in trade credit insurance premiums. “owever, that is still signiicant. ”oreover, as with the analsis on the impact o trade on marine lines, the estimates do not account or a possile negative impact o a gloal trade slowdown on economic activit. Conclusion —ver the net decade, marine and trade The longrun prospects o marine and trade credit insurance lines are signiicantl credit insurance premiums are likel to aected the development o the tradeto € ratio. This ratio should pick up in develop more modestl than previousl. the coming ears as the gloal econom recovers. “owever, the recent slowdown in trade growth also relects, to a certain etent, permanent structural changes in the gloal econom. ”ost o the mentioned actors are likel to persist, pointing to more modest development o marine and trade credit insurance premiums than would have een epected several ears ago using onl real € growth rates. 23 †or an economic analsis o the trade credit insurance market, see Trade credit insurance & surety: taking stock after the financial crisis, —ctoer 201‰, ‹wiss ˜e. Swiss Re sigma No 3/2016 21
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