Allianz Risk Barometer 2018: Fear of business interruption
The "Allianz Risk Barometer 2018" shows a great fear of business interruption among Swiss companies. The potential for "cyber hurricane" events characterizes the risk environment this year. The experts assess the risks from legislative changes or regulations as lower.
The Allianz Risk Barometer shows that companies worldwide are exposed to a wide range of risks that can jeopardize the success or even the existence of companies of all sizes and in all industries in a networked economy. Business interruption is thus one of the biggest risks worldwide - including in Switzerland. This is shown by the seventh edition of the Allianz Risk Barometer, for which almost 2,000 risk experts from various companies and the Allianz Group from a total of 80 countries were surveyed.
Business interruptions remain by far the biggest corporate risk in Switzerland, according to risk experts. Whereas last year business interruption was named as the greatest risk in 50 percent of responses, this figure has now risen to 70 percent. There has also been little change in the risk assessment of the following positions: Risks from market developments, for example, are ranked second, as in the previous year, at 45 percent, while cyber attacks occupy third place by a narrow margin (43 percent) in this year's Allianz Risk Barometer.
Swiss companies are more critical than last year about new technologies (rank 5 /2017: rank 7) as well as quality defects, serial defects and the consequence of product recalls (rank 6/ 2017: rank 8). New among the top 10 risks in Switzerland are fire and explosion as well as possible power plant failures. The experts estimate that risks from changes in legislation or greater regulation are lower than in 2017 (rank 6/ 2017: rank 4).
Massive financial losses threaten
"Business interruption is once again at the top of the list in Switzerland," explains Christoph Müller, who is responsible for the business of the Allianz industrial insurer Allianz Global Corporate & Specialty in Switzerland: "There are always new causes for this sometimes existential business risk. For a long time, it was mainly natural hazards or industrial accidents that paralyzed operations. In the digitally networked economy, other new triggers are emerging, such as cyber attacks, IT breakdowns or even the consequences of strikes or terrorist attacks. In such scenarios, massive financial losses can occur without plants or buildings having been damaged or destroyed. For risk managers, this means that the protection of intangible assets such as data, networks or intellectual property is increasingly coming to the fore."
Horrendous cyber incidents
Increasingly, cyber incidents are seen as the new triggers for business disruption. Cyber risk modeller Cyence, working with AGCS, estimates that the average cost impact of a cloud outage lasting more than 12 hours for companies in the financial, healthcare and retail sectors could be around €700m in North America and just under €600m in Europe.
Business interruption in first place worldwide
Globally, companies are also most concerned about business interruption (ranked 1) and cyber attack (ranked 2). Large losses from natural disasters (rank 3) also remain a growing concern globally, with climate change and increasing weather volatility (rank 10) also appearing in the top 10 most important risks globally for the first time due to the record-breaking disaster year in 2017. Meanwhile, risks posed by new technologies (rank 7/ 2017: rank 10) are one of the biggest risers in the global ranking.
