Global insolvencies expected to grow by +5% in 2026 and +1% in 2027
For corporates, the pressure comes from underperforming GDP growth, higher-for-longer interest rates and energy costs, on top of the larger number of active companies.
Globally, 2.7 million jobs are directly at risk in 2026 and 2027, meaning a +180,000 increase compared with 2025.
AI adoption can accelerate business insolvencies in smaller and less diversified markets due to the competitive wedge it creates between early adopters and laggards.
Allianz Trade releases its latest Insolvency Report, unveiling updated forecasts for 2026, 2027, and the outlook for 2028. According to the world leader in trade credit insurance, global business insolvencies will rise by +5% in 2026 and +1% in 2027, marking five consecutive years of increases. Given the uncertain geopolitical and macroeconomic environment, the peak in insolvencies will be delayed by one year to 2028 (-1%), slightly retreating from very high levels.
Underperforming GDP growth, high energy costs, and higher-for-longer interest rates
Several structural factors explain this persistence. With enduring tensions in the Middle East, GDP growth is expected to underperform compared to the 2023-2025 period while energy costs remain high and governments offer limited fiscal support. In parallel, monetary policy is getting tighter, with higher-for-longer interest rates putting further pressure on the most vulnerable companies. At the same time, the stock of active companies expanded by roughly 10% between 2021 and 2025. This broadens the pool of companies exposed to failure, as many of these young entrants are financially fragile: fewer than half of new companies survive beyond five years in Europe.
“With multiple shocks compounding since the start of the year, much higher-than-expected interest rates are ramping up the pressure on already fragile companies and this will continue: 60% of countries will maintain higher policy rates in 2027 than in the prior 12 to 24 months, inflating funding costs and squeezing margins. In Western Europe, a +100bp rise in bank lending rates would add between EUR 6bn and EUR 10bn in interest expenses, reducing margins particularly in renewables, telecom, and power. Meanwhile, higher-for-longer energy costs will also intensify the pressure on profitability, especially for energy-intensive European industries,” explains Aylin Somersan Coqui, CEO of Allianz Trade.
APAC: rising due to less favorable short-term GDP momentum and adverse monetary conditions
The upward momentum is principally driven by China (accounts for roughly 58% of the regional index) and Japan. In China, cyclical and structural headwinds should persist, notably weakness in households’ confidence, difficulties in specific sectors in overcapacities (such as solar energy) and credit constraints. Insolvencies are expected to increase moderately by +1% in 2026 and +2% in 2027. In Japan, despite the supportive role of AI-linked exports and investments and some fiscal relief, inflationary pressures and financing costs will keep the pressure on firms margins, notably in the B2C sectors. Insolvencies are expected to increase by +6% in 2026 and +2% in 2027, reaching the highest level since 2012. Overall, insolvencies in APAC are expected to rise by +3% in 2026 and +2% in 2027, before stabilizing in 2028.
As for the rest of the region, Australia would reach a record of approximately 11,850 cases in 2026 (+1%) before declining by -4% in 2027, while New Zealand would see a +6% rise in 2026 before declining by -9% in 2027. South Korea is expected to reach a record of approximately 2,560 cases in 2026 (+12%) before stabilizing at +1% in 2027. Hong Kong would see insolvencies rise +6% in 2026 and +4% in 2027 to approximately 710 cases – the highest level since 2005. Taiwan (+36% in 2026 and +3% in 2027) and Singapore (-23% in 2026 and +3% in 2027) would display highly volatile and opposite trajectories, largely due to small-base effects rather than fundamental regime shifts.
More and more jobs at risk, with a new peak in Europe and North America
According to Allianz Trade, roughly 2.7 million jobs are directly at risk in 2026 and 2027. This represents a +180,000 increase compared with 2025, and a +700,000 increase compared with 2023, the first year of the post-Covid rebound in global insolvencies.
“Overall, construction, retail, and services are the most exposed sectors. Europe accounts for almost 60% of jobs at risk (1.6 million) with France, Germany, and the UK leading the way. North America follows, representing 24% of total impacted jobs (650,000). For both regions, this would be a 13-year high. In Asia, the impact is real but more moderate, as the region accounts for only 11% of jobs at risk (305,000),”adds Maxime Lemerle, Lead Analyst for insolvency research at Allianz Trade.
Is AI already increasing business insolvencies?
Allianz Trade conducted an analysis across eight EU economies and nine sectors to identify the main drivers of business insolvencies. The findings suggest that macroeconomic conditions and sector-specific fundamentals remain the dominant determinants, while AI adoption is not yet correlated with insolvency trends. However, it identifies an exception in smaller and less diversified markets.
“Our research suggests that AI adoption can accelerate business insolvencies in smaller and less diversified markets due to the competitive wedge it creates between early adopters and laggards. In Belgium and Sweden, which have the highest AI adoption rate in our sample (35%), we observe that the most digitized sectors are also those recording the highest insolvency numbers. The same pattern emerges from a sector perspective. Information & communication, which is the most AI-intensive sector in our sample (70% adoption), shows higher insolvency figures than the national average in five of the eight countries surveyed,” concludes Mr Lemerle.
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Jason Wong
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jason.wong@allianz-trade.com
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About Allianz Trade
Allianz Trade is the global leader in trade credit insurance and a recognized specialist in the areas of surety, collections, structured trade credit, and political risk. Our proprietary intelligence network is based on instant access to data on 545 million corporates. We give companies the confidence to trade by securing their payments. We compensate your company in the event of bad debt, but more importantly, we help you avoid bad debt in the first place. Whenever we provide trade credit insurance or other finance solutions, our priority is predictive protection. When the unexpected occurs, our AA credit rating means we have the resources, backed by Allianz, to provide compensation and help maintain your business. Headquartered in Paris, Allianz Trade is present in over 40 countries and employs 5,900 people. In 2025, our consolidated turnover was €4 billion, and insured global business transactions represented €1,400 billion in exposure. For more information, please visit allianz-trade.com.
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The statements contained herein may include prospects, statements of future expectations and other forward-looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such forward-looking statements. Such deviations may arise due to, without limitation, (I) changes of the general economic conditions and competitive situation, particularly in the Allianz Group’s core business and core markets, (II) performance of financial markets (particularly market volatility, liquidity and credit events), (III) frequency and severity of insured loss events, including from natural catastrophes, and the development of loss expenses, (IV) mortality and morbidity levels and trends, (V) persistency levels, (VI) particularly in the banking business, the extent of credit defaults, (VII) interest rate levels, (VIII) currency exchange rates including the euro/US-dollar exchange rate, (IX) changes in laws and regulations, including tax regulations, (X) the impact of acquisitions, including related integration issues, and reorganization measures, and (XI) general competitive factors, in each case on a local, regional, national and/or global basis. Many of these factors may be more likely to occur, or more pronounced, as a result of terrorist activities and their consequences.