Business interruption and cyber incidents were tied for the top business risks in 2019, according to the 2019 Allianz Risk Barometer.
“The big driver with business interruption is largely the global nature of businesses,” says Bernard McNulty, head of claims for Canada at Allianz Global Corporate and Specialty, noting that businesses, particularly manufacturers, source components from all over the world to assemble them in one country. “If the supply chain is stopped for whatever reason it can cause a business interruption claim.”
He says business interruption is more top of mind because “we’re fragile to so many forces around the globe.”
When it comes to cyber incidents, McNulty says there’s increased awareness of the implications and people are starting to speak about incidents more publicly than when the incidents first started to occur. “There’s a monetary awareness about how large and complex these breaches are and they’re far more public. I think our buyers are just much more aware of the concern and how frequently these things are now happening.”
In Canada specifically, the top ten risks the survey identified were business interruption, cyber incidents, climate change/weather volatility, market developments, changes in legislation and regulation, natural catastrophes, environmental risks, fire and explosion, new technologies and a shortage of skilled workers.
The three of these that made the list for the first time this year were changes in legislation and regulation, environmental risks and the shortage of skilled workers.
“There have been a couple of major environmental spills in Canada that have drawn awareness to environmental issues and so on, but I think as we see a lot more brownfields in Canada being redeveloped, a lot of those brownfields have environmental concerns, so that’s become far more topical,” McNulty says.
The eighth annual survey sought responses from Allianz customers (global businesses), brokers and industry trade organizations as well as risk consultants, underwriters, senior managers and claims experts from the corporate insurance segment of both Allianz Global Corporate and Specialty and other Allianz entities.