Insolvency Trends and Forecasts
According to the October 2026 Insolvency Report by Allianz Trade, UK business insolvencies are expected to fall by 4% to approximately 25,600 cases in 2026, with a further 3% decline to around 24,800 in 2027. While this marks an end to a five-year upward trajectory, figures will remain 21% above pre-pandemic averages by 2027. Sectors such as construction, wholesale and retail trade, hospitality, and real estate continue to see high volumes of failures. Allianz Trade attributes the sustained pressure to an expanded stock of active companies, tighter monetary policy and higher interest rates globally, elevated energy costs, and underperforming GDP growth.
Wider Economic and Market Impacts
The report estimates that 213,000 UK jobs are directly at risk from business insolvencies between 2026 and 2027. Meanwhile, the UK trade credit insurance market remains highly competitive with softened pricing, creating a situation of competitive pricing alongside elevated counterparty risk. Additionally, research into AI adoption suggests that technology uptake can accelerate business insolvencies in smaller, less diversified markets by widening the gap between early adopters and laggards.