End-2025 Review and 2026 Outlook
As we move into 2026, the trade credit insurance market is less about guarding against sudden collapse and more about credit quality, cash discipline and selective risk differentiation. While headline economic growth remains resilient, pressure is building beneath the surface - particularly through working capital, sector exposure and buyer behaviour.
This update outlines what finance leaders should expect in 2026 and how to position trade credit insurance as a strategic enabler, not just a defensive tool.
Market backdrop: a shifted risk mix
2025 proved to be a stop-start year that quietly reshaped the risk landscape.
Key themes shaping 2026 include:
Private demand and capital expenditure gaining momentum, while household consumption and parts of the labour market soften
Global growth remaining resilient but unspectacular (circa 2.9%), with Australia’s growth mix tilting toward private demand and capex
Inflation expected to remain above the RBA target band for much of 2026, keeping rate cuts off the table
Sustained pressure on interest-sensitive sectors, including construction, building materials and consumer durables
Key takeaway
Risk is not escalating evenly. Pressure is building through cash flow, working capital and sector exposure rather than headline growth.
Sector performance and insolvencies: uneven, not systemic
Sector outcomes are becoming increasingly divergent. Where momentum remains strong?
Tech, AI and data infrastructure continue to lead earnings, supported by strong capex momentum and a $37bn+ data centre pipeline
Healthcare and pharmaceuticals remain resilient, underpinned by defensive demand and public funding
Supply chains linked to machinery & equipment, electricals, steel, HVAC and civil works may outperform though project timing and counterparty concentration risks remain
Where pressure persists?
Automotive remains the standout laggard due to EV transition costs, competition and tariff exposure
Mid-market businesses face margin compression and higher debt servicing costs
Insolvencies continue to rise, but at a slower pace, pointing to a late-cycle environment rather than a systemic spike
Key takeaway
Credit stress is selective and sector-specific. Understanding buyer profiles matters more than relying on general market conditions.
What this means for trade credit insurance in 2026?
Capacity remains available, but underwriting discipline is tightening. Download our latest market update to understand where insurers are focusing and how to position your program for 2026.
The contents of this publication are provided for general information only. Lockton arranges the insurance and is not the insurer. While the content contributors have taken reasonable care in compiling the information presented, we do not warrant that the information is correct. The contents of this publication are not intended as a legal commentary or advice and should not be relied on in that way. It is not intended to be interpreted as advice on which you should rely and may not necessarily be suitable for you. You must obtain professional or specialist advice before taking, or refraining from, any action based on the content in this publication.
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