Interruption to business and supply chain losses have been ranked as the top business risk for 2014 following a poll of corporate insurance experts
The third annual Allianz Risk Barometer was published today. It is based on a survey of more than 400 risk consultants, underwriters and claims experts working in Allianz's corporate insurance arms across 33 different countries.
Business interruption and supply chain risk was cited as one of the three most important risks by 43% of respondents. Allianz estimated that business income and supply chain-related losses typically account for 50% to 70% of insured property catastrophe losses, as much as $26bn a year.
The second biggest risk was natural catastrophes, such as storms, floods and earthquakes, cited by 33% of respondents, and the third was fire and explosion named by 24%.
There were two new entrants to the top ten business risks: cyber crime, IT failure and espionage, and theft fraud and corruption, cited by 12% and 10% of respondents respectively. Reputational damage had also risen up the risk ranking, moving up from tenth place to sixth. Fifteen per cent of the survey's respondents named reputation damage, from, for example, social media, as a top-three risk.
Commenting on the findings, Axel Theis, chief executive of Allianz's global corporate and speciality team, said: 'Identifying the impact of interconnectivity between different risks is a top priority for risk managers.
'Today's business continuity plans must prepare for an increasing range of risk scenarios which need to reflect the sometimes hidden knock-on effects. For example, a natural catastrophe can result in business interruption, IT-systems failure and power blackouts, among other perils.'
Intensified competition, quality deficiencies, market fluctuations and credit availability were all declined in importance as risks, the Allianz table showed.