Talk about shooting the messenger. Credit insurers, which protect suppliers from the risk that customers do not pay bills, have withdrawn some of their cover. This is seen as yet another turn of the screw that could send waves of companies to the wall. Of course, it is bad news when cover is pulled. Quite a few suppliers – although still a minority, for example, of UK companies – rely on this insurance. Not only does insurance cover protect small suppliers from the devastation of one very large bad debt, but it can also encourage banks to keep lending to these suppliers because they enjoy an added layer of security.

But insurance companies cannot keep piling on more risk than they can bear. In the UK, loss ratios are rising sharply, from about 40 per cent of premiums paid out in claims to well over 60 per cent. Underwriters will lay off some of that risk with reinsurers, but many of those contracts are coming up for renegotiation, and reinsurers have less appetite for risk as well. In any case, when insurers make the momentous decision to withdraw cover, they are not telling suppliers to stop trading. Suppliers have their own choices to make: they can ship the goods to customers without insurance, they can trade on secured terms, demanding some form of collateral from clients, or they can stagger their shipments.