Business Interruption tops Allianz’ 2017 risk poll
Risk managers are “bracing for a year of uncertainty”, according to the Allianz Risk Barometer 2017 that lists the top three risks facing corporates across the world as business interruption, market developments-volatility and cyber.
Business interruption retains its position as the number one business risk globally for the fifth consecutive year, finds the annual survey of over 1,200 risk experts.
Allianz said in addition to loss of income, business interruption carries “multiple new triggers” including cyber threats, disruption caused by political violence, strikes and terror attacks.
“This trend is driven, in part, by the rise of the “Internet of Things” (IoT) and the ever-greater interconnectivity of machines, companies and their supply chains which can easily multiply losses in case of an incident,” Allianz said.
New technologies – including nanotechnology, drones and increasing interconnectivity – entered Allianz’ top 10 list of risks for 2017. “A range of new risks are emerging beyond the perennial perils of fire and natural catastrophes which require re-thinking of current monitoring and risk management tools,” Allianz said.
Political change and uncertainty around protectionism and anti-globalisation “could produce a business interruption threat of a different kind” in 2017, said Allianz.
Companies need to invest more in monitoring political change against their business models, the firm advised. It named Brexit, a Trump presidency and EU elections as potential areas of concern.
Chris Fischer Hirs, CEO of Allianz Global Corporate & Specialty SE, said: “Unpredictable changes in the legal, geopolitical and market environment around the world are constant items on the agenda of risk managers and the C-suite.”
Survey respondents named market developments and volatility as the second most important business peril for 2017. This risk polled as the top risk for several sectors including financial services, aviation, marine and shipping.
Cyber risks emerged as the third most important risk globally for 2017. Although unchanged from its position in 2016, concern amongst risk managers has risen for the fourth consecutive year. Cyber risks climbed to the second spot in US and Europe with risk managers from the UK, Germany and the Netherlands naming cyber risk as their number one threat for 2017.
“The threat now goes far beyond hacking and privacy and data breaches,” Allianz Risk Barometer said. “Results also show that smaller companies may be underestimating cyber risk: in this category (revenues <€250 million), cyber ranks only #6,” it added.
Natural catastrophes and climate change ranked as the fourth highest risk for 2017 worldwide. Its position rises for businesses in Asia and polls as the top concern in Japan and Hong Kong.
“Natural catastrophes and climate change worry our customers and society at large,” said Axel Theis, board member of Allianz SE.
Allianz Risk Barometer 2017 – Top 10 risks (2016 position)
- Business interruption (1)
- Market developments (2)
- Cyber incidents (3)
- Natural catastrophes (4)
- Changes in legislation/regulation (5)
- Macroeconomic developments (6)
- Fire/explosion (8)
- Political risk/violence (9)
- Loss of reputation or brand value (7)
- New technologies (11)
