As of April 27, coronavirus infections had topped 3 million and death toll was over 207,000. Frantic research and development of vaccines are underway and there is cautious optimism that an effective immunization tool will be found.
It’s not just humans who need these vaccines.
The respiratory illness has ravaged travel-related industries such as airlines, hospitality and retail but it is also threatening the health of small and medium enterprises (SMEs), the backbone of many economies. A ‘vaccine’ is needed for SMEs too.
According to Allianz Research, coronavirus could prove fatal to as many as 9 percent of the SMEs in Germany and 11 percent in the six largest economies in Europe this year. The researchers forecast a hit of as much as 1.34 trillion euros to the Eurozone economy from the pathogen.
To protect hitherto healthy German companies, including SMEs, from ruin and prevent domino effect on supply chains, Allianz’s trade credit insurer Euler Hermes has joined hands with Germany’s federal government and the German Insurance Association. Under the initiative, the government will backstop losses of 30 billion euros for trade credit insurers this year to cover payment defaults by clients of German companies.
On their part, Euler Hermes and the other participating insurers will contribute significantly to the umbrella for the economy: They will transfer 65 percent of their premium income to the government, in addition to covering losses of up to 500 million euros and all default risks exceeding the 30 billion euros of the government guarantees.
Euler Hermes also reached an agreement with the French government, leading the negotiations together with other insurers and insurance associations to develop economic support solutions. A similar scheme was announced in Belgium through collaboration with credit insurers, governments and trade associations.
In addition to these state support programs, Euler Hermes has implemented a global strategy to support companies: regular global and local webinars are conducted to share with clients and brokers flexible claims and policy management measures, risk insights and economic predictions and procedures for accelerated claim payment as well as to address any specific needs of clients.
After the United States, Europe is the region worst affected by the pandemic. Spain and Italy have been the biggest victims in Europe, both in terms of people and economy, with France being the third worst-hit.
To soften the blow to SMEs, Allianz Spain has initiated several support measures, including delaying premium payments for up to 120 days, while Allianz France has pledged to contribute up to 28 million euros of the 400 million euros that the French Insurance Federation is donating to a French government fund aimed at helping small companies and independent workers. Moreover, Allianz France, along with other French insurers, has pledged to support the economic recovery of the country. For this, a global investment program of at least 1.5 billion euros has been set up for mid-cap companies and SMEs, particularly in the health sector. The contribution of the Allianz group in France to this program amounts to 120 million euros.
Other entities of the group have rolled out similar measures.