What does “Business Risk” look like in 2018?

Firstly, a huge thanks to Allianz for publishing their latest Allianz Risk Barometer recently. If you haven’t taken the time to read it, please do;  it, together with similar such reports from major insurers and brokers, really gives a sense of the main issues that are keeping leading global companies ‘awake at night’.

Globally, Number 1 on the Barometer is ‘Business Interruption’: no real surprises there as it was at the top for 2017, but more interestingly, although perhaps not too surprising – is the rise to Number 2 for ‘Cyber Incidents’. It seems as though a week doesn’t go past without some news of a breach or incident that has the ‘Cyber’ label attached to it and, with the level of customer demand for easier/faster services and the continued evolution of mobile devices, perhaps 2019 will be the time when Cyber hits the top of the ranking. Whilst there are many people with a variety of ‘agendas’ to cause such ‘Cyber Incidents’, talking with a range of clients over the last few weeks, it seems that the ‘human’ aspect is still the greatest weakness in the defence – with staff often being the cause of failures etc, so focusing on good practice seems more important than ever.

At Number 3, ‘Natural Catastrophes’ has risen in the rankings – and whilst there is often much that we can do to help ourselves with Cyber, here we are very much in the hands of ‘nature’, so I can see how this causes concern for business.

Looking more locally, in Europe, the uncertainty caused through Changes to Legislation and Regulation hits in at Number 3. Europe itself, partly through the discussions over Brexit, is an uncertain place now for businesses with many changes likely, but ‘uncertain’ in terms of impact, cost to implement and the hand of regulation. Looking at the Barometer, there is quite an insight as to the varying tempo of concerns from country to country.

In the Americas and Asia Pacific, ‘Business Interruption’ and ‘Cyber’ are top of the ranking.

Zurich gave a slightly different view with The Global Risks Report 2018, which has Environmental Risks uppermost in the minds of business with Cyber in a strong second. Interestingly, Geopolitical is gaining ground with the trend to re-establishing the state as the primary focus of power getting more traction and the uncertainties and potential conflicts this brings.

Some great insight and when combined with other market surveys, it really shines a light on the thinking of our customers; the challenge is now to make sure that we respond to those concerns and risks.