// Reports emerge that Iceland’s suppliers have had their insurance cut
// When insurers cut or withdraw cover, suppliers tend to demand payment up front from their customers
Iceland’s suppliers have had insurance cover cut amid ongoing concern over Brexit.
According to The Sunday Times, Euler Hermes reduced its cover on the grocer’s suppliers over summer, and Atradius is mulling reduction in the cover it provides suppliers.
Insurance cover protects suppliers against any risk of a retailer collapsing after an order has been placed but before the payment has been received.
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The decision means Iceland’s suppliers could potentially start to demand payment upfront.
In a statement, Iceland said: “While it is true that Euler Hermes reduced the total cover available to Iceland suppliers earlier this year, as part of a general reduction in its UK exposure, this has had no effect on either the level of our creditors or our relationships with any of our suppliers.
“We have not been made aware of any planned change in the total cover provided by Atradius.”
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