insolvency risk

Severe economic crises lead to a significant increase in the frequency of company insolvencies. The insolvency of one company in turn has a significant negative impact on other companies, which consequently lose key customers or suppliers. For risk management, the quantification of risks and the initiation of coping measures, it is particularly important in a crisis to properly assess the insolvency risks of business partners (counterparty risks). It is essential here that the insolvency risks of companies cannot be viewed independently, but that there is a considerable systematic component.