Canadian companies are facing the same wave of uncertainty around US tariff policies and global trade slowdowns as their international counterparts – but they may be slightly better positioned to navigate the turbulence.
Speaking to Insurance Business at the RIMS Canada Conference, John Middleton (pictured), vice president, complex risk, trade credit at HUB International, explained that while tariffs and slowing trade flows are raising credit risks worldwide, Canada’s trade framework offers a partial buffer.
“Canada’s got a bit of a leg up on the rest of the world, other than maybe Mexico, just because of the Canadian–US–Mexican Free Trade Agreement,” Middleton said. The trilateral deal, he said, has shielded Canadian exporters from some of the immediate impacts of US tariff measures that have rattled supply chains elsewhere.
For many Canadian industries, that means continued access to US markets without the same direct tariff penalties facing companies in Europe or Asia. This insulation, however, is not permanent. The agreement comes up for renegotiation in 2026, creating a looming deadline that could shift conditions dramatically.
Still, in the short term, Middleton stressed that Canadian exporters can take advantage of this relative stability to strengthen their credit risk strategies and expand into new markets. At the same time, global uncertainty is fueling greater interest in trade credit insurance as a tool to protect receivables, manage counterparty risk, and give companies confidence to grow even as tariffs and trade policies remain unpredictable.
Beyond its role as a shield against losses, Middleton emphasized that trade credit insurance is increasingly being used by Canadian companies as a growth enabler.
One of the most immediate benefits is financing. By insuring receivables, companies are able to unlock greater access to bank lending. “They can insure their receivable, and the bank will lend 90% against that insured receivable,” Middleton said. “That gives them enhanced margining value on their receivables, which is a great thing for accessing additional financing to deploy to grow the business.”
Credit insurance is also helping firms pursue diversification – a policy goal that aligns with Canada’s trade agenda. While the United States remains Canada’s dominant trading partner, Ottawa has signed multiple free trade agreements that open doors to markets across Europe, Asia, and Latin America. The challenge for businesses has been assessing which potential buyers in those regions are creditworthy.
That’s where insurers’ global data comes in. Providers maintain extensive databases on companies around the world, giving Canadian exporters a clearer picture of counterparties before they commit to deals. According to Middleton, access to independent credit assessments is already helping firms expand with greater confidence beyond the US market.
Finally, he noted, credit insurance supports better risk management at home. For many organizations, the attraction lies as much in information as in indemnification. By securing an external credit opinion on their customers, companies can sleep easier knowing they are partnering with reliable buyers – and, in turn, make sharper decisions about growth.
“Let’s get a third-party independent credit opinion on our key customers, because that information is useful for us in terms of the growth of our business,” Middleton said.
The Canadian advantage comes against a backdrop of rising fragility across industries worldwide. Earlier in September, Allianz Trade released its Q2 Sector Atlas, warning that the US tariff cycle is amplifying existing macroeconomic pressures. Nearly 90% of industries are now rated either medium or sensitive risk, while only 9% are considered low risk – well below the pre-pandemic share of 15%.
“What’s different now is the number of downgrades among industries that were usually strong,” said Ano Kuhanathan, head of corporate research at Allianz Trade.
For Canadian exporters, the message is clear: while trade agreements provide a buffer, the wider global environment is still fragile. Rising insolvencies, slowing international demand, and tariff volatility mean credit quality can deteriorate quickly. Middleton argued that this is precisely where trade credit insurance adds value – by giving firms both a financial backstop and access to global intelligence that can help them avoid risky partnerships.
In that sense, Canada’s relative advantage is not immunity but opportunity. By leveraging tools like credit insurance while trade conditions remain favorable, businesses can diversify more confidently, strengthen their balance sheets, and prepare for whatever the 2026 renegotiation of the trilateral deal may bring.
