Snapshot: Top Business Risks 2017 Around the World
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Companies worldwide are bracing themselves for a year of increased uncertainty, driven by growing concerns over political, legal and regulatory developments around the globe. Digital dilemmas such as the impact of new technologies on the risk profile of industries and cyber incidents are a rising concern as well, while natural catastrophe activity remains high on the agenda. But what troubles businesses most are actual or anticipated losses from a business interruption. Read more
Business interruption is the top risk for the fifth year in succession, but new triggers continue to emerge. Perils such as natural catastrophes and fires are the causes businesses fear most, but the nature of the risk is shifting increasingly towards non-damage events. A cyber incident or the indirect impact of an act of terrorism or political violence are events that can result in large losses without causing physical damage. More of these types of events are expected to occur in future. Read more
Companies will need to invest more resources into better monitoring of politics and policy-making around the world in order to anticipate, and adapt to, any sudden changes of rules that could impact business models and markets. This comes amid fears of increasing protectionism and anti-globalization, which could produce a business interruption threat of a different kind. Read more
Terrorism risk is rising and a business does not have to be the direct victim of an act to feel the effects. Locations can become inaccessible and supply chains impacted in the wake of an attack. The growing risk of political violence, acts such as war, civil war, insurrection and other politically motivated incidents, which focus on countries rather than certain locations, should also not be underestimated, as the impact for global businesses can be much greater and longer-lasting. Read more
Market developments ranks as the second top risk for businesses overall but the top perils vary by industry sector. Increasing reliance on technology and automation is transforming, and disrupting, companies across all industry sectors. Digitalization is shifting the nature of corporate assets from mostly physical to increasingly intangible, producing new risks as well as benefits. Read more
For the fourth year in succession businesses are more concerned about cyber incidents. The threat now goes far beyond hacking and privacy and data breaches, although new data protection regulations will exacerbate the fall-out from these events for businesses. Technical IT failure or human error can also result in costly damages. The digitalized production or Industry 4.0 environment means failure to interpret or submit data correctly can halt production. Read more
There are significant local and regional differences in the top 10 risks around the world. Market and macroeconomic developments rank as the top two risks in the Africa & Middle East region. Concern about cyber incidents climbs to second position in Europe. Read more
The rise of new technology and the shift from physical asset protection to intangible risks means the insurance model is also evolving. Today’s risk management world is more fluid and data-driven and intangible risks in particular require specialist services such as forensic IT support or crisis management. Demand is also expected to increase for new insurance coverages such as cyber and nondamage business interruption insurance, as companies look to protect against an increasing range of exposures.
Top Business Risks
Risk Barometer Methodology
The sixth annual Allianz Risk Barometer was conducted among Allianz corporate clients and brokers. It also surveyed risk consultants, underwriters, senior managers and claims experts of Allianz entities around the globe. Respondents were questioned during October and November 2016. The survey focused on large and small to mid-sized companies.
There were a record 1,237 respondents from a total of 55 countries. As multiple answers for up to two industries were possible, 4,679 answers were delivered. Participants were asked to select industries about which they are particularly knowledgeable and name up to three risks they believe to be of most importance.
Most answers were for large enterprises (over €500m/$520m revenue) [2,325 responses, 50%]. Small enterprises (below €250m revenue) contributed 1,275 responses (27%) while mid-sized enterprises (€251m to €500m revenue) produced 1,079 responses (23%). Risk experts from 21 industry sectors were featured.
Ranking changes in the Risk Barometer are determined by positions year-on-year, ahead of percentages.