Trade Indemnity, the credit insurer, said that the rate of decline in insolvencies was levelling off as the economic recovery continued.
Vic Jacob, Trade's chief executive, said: "We're predicting a 12 per cent drop this year but there is a limit to how far and how fast the figures can come down."
Last year the group's clients reported just under 4,000 business failures worldwide, a 37 per cent drop on 1993.
Mr Jacob said a lot of companies were now better managed and slimmer, with less debt.
He was speaking as the group reported a 14 per cent decline in pre-tax profits to £5m last year. The bottom line was hit by a £7.5m provision announced at the halfway stage to cover additional liabilities under a policy that it wrote for the Investors Compensation Scheme.
The provision masked a substantial improvement in Trade's underwriting results. Trade operates on a three-year time lag in closing underwriting years.
Yesterday's underwriting results - for 1992 - showed a 4.8 per cent rise in gross premium income to £152m, while gross claims paid were 38 per cent lower at £71.8m. The gross figures do not take into account the business that Trade reinsures.
Mr Jacob said the improved underwriting results reflected the group's increasing grasp of risk management.
He added that Trade's percentage share of total insolvencies in the UK had been dramatically lower in the early 1990s than in the recession of the early 1980s.
As a result the dividend is being doubled to 1p. Tony Brend, chairman, said: "Profit of our ongoing operations is excellent. The underwriting results reflect the determined actions taken by management over recent years to improve the group's risk exposure and pricing."
He added that he had been disappointed by the need to make the further provision against losses on the ICS policy, but believed that no further provisions would be necessary.