Drought is the biggest risk to property, and cloud computing risk is the greatest exposure in liability, according to a report released Tuesday by Swiss Re Ltd.
The reinsurer’s Sonar Emerging Risk Insights Report features six emerging trend spotlights and highlights 20 more emerging risk themes identified by the company’s SONAR tool, an internal crowdsourcing platform that collects input and feedback from underwriters, client managers, risk experts and others within the insurance sector.
Increasing migration to cloud-based computing systems exposes business to new risks, Swiss Re said.
“Should an event bring down or severely impair,” cloud services from a single large provider, for example, “the financial loss could be immense,” said the report.
Water shortages and related problems also pose numerous threats.
Losses in agricultural, energy and forestry, risk of large-scale wildfires, drought-induced soil subsidence and water pollution events in the energy, mining and agricultural sectors are just some of the rising exposures related to drought, according to the report.
The report also identifies rising inflation and regulatory fragmentation as near-term risks, while tapping “underestimated infectious diseases” and “emerging artificial intelligence legislation” as longer-term threats.
“Ignoring emerging risks is just not an option. We need to prepare for the risks of tomorrow,” Patrick Raaflaub, Swiss Re’s group chief risk officer, said in the report.
Source: BusinessInsurance