The Allianz Risk Barometer outlines the most important business risks for the next 12 months and beyond, based on the insight of 2,650 risk management experts from 89 countries and territories.
Following a year of unprecedented cyber-attacks, business interruption and supply chain disruption, and natural catastrophe activity, these three perils are foremost in the minds of survey respondents in 2022. Meanwhile, awareness of the risks of climate change is growing among companies, achieving its highest-ever position of sixth in the Allianz Risk Barometer.
Cyber risk hits the top spot in this year’s survey, with a series of high-profile ransomware attacks, combined with problems caused by accelerating digitalization and remote working, pushing it up from third in 2021, when it finished behind the closely related risks of business interruption and the Covid-19 pandemic.
Ransomware and Data Breaches
Ransomware has dominated the cyber threat landscape in recent years: it ranks as the top cyber exposure of concern in this year’s Allianz Risk Barometer (57% of responses), just ahead of data breaches (also 57%). Ransomware has become big business for cyber criminals, who have refined their business models and tactics, lowering barriers to entry and making it easier to carry out attacks. Criminals with little technical knowledge can now carry out ransomware attacks for as little as a $40 per month subscription, using cryptocurrency to help evade detection.
Cyber insurance claims have increased significantly over the past three years, driven by the rise of losses from external manipulation of systems, as well as the increased uptake in cyber insurance. Overall, cyber-related claims seen by AGCS increased from almost 500 in 2018 to more than 1,100 in 2020. Ransomware-related claims increased 50% year-on-year in 2020 (to 90), while the total number of ransomware claims received in the first half of 2021 was the same as reported during the whole of 2019 (60), according to AGCS analysis, as criminals have become more organized and better resourced. Extortion demands have more than doubled while business interruption losses have escalated as larger companies and their supply chains are targeted.
Despite the ongoing repercussions of Covid-19, the most feared cause of BI in this year’s survey is cyber, which ranked second to pandemic in this category in 2021. The growing concern reflects the rise in ransomware attacks, which can be utilized to derail businesses and their strategies, and the digitalization of business models and supply chains, and the shift to remote working, which have accelerated during the pandemic.
Allianz Global Corporate & Specialty (AGCS) is a leading global corporate insurance carrier and a key business unit of Allianz Group. They provide risk consultancy, Property-Casualty insurance solutions and alternative risk transfer for a wide spectrum of commercial, corporate and specialty risks across 10 dedicated lines of business. You can view their 2022 Risk Barometer here.
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