Lessons from Covid-19

The vaccines rollouts have begun. Despite teething troubles, the world’s biggest vaccination program seems to be on track, raising optimism that 2021 will be a better year after all.

Risk managers, however, have a busy 2021 ahead.

A Covid-19 related trio of risks – business interruption, pandemic outbreak and cyber incidents – top the Allianz Risk Barometer 2021, the latest edition of the annual survey of risk management experts by corporate insurer Allianz Global Corporate & Specialty

Unsurprisingly, pandemic outbreak has climbed 15 positions from last year to the second spot. In addition, market and macroeconomic developments as well as political events and violence have gained significance as far as business threats go.

A look at some of the key findings of the survey of risk management experts from 92 countries... 

A changed corporate landscape

Like most big crises, the outbreak has altered life for both humans and companies.

More than half of the experts surveyed in the Risk Barometer believe that accelerated digitalization is the change that will have the biggest impact on their companies. Following closely is remote working, with half of the respondents foreseeing their corporate DNA altered by this new way of working. Other changes seen as having the greatest influence are increased insolvencies, restrictions on travel and reduced business travel, and rising cyber risks.

The pandemic has also heightened potential threats from market and macroeconomic developments and political events and violence. “Disruption associated with political, economic and social trends, like strikes, protests and civil unrest, is often underestimated,” says Philip Beblo, Global Practice Group Leader Utilities and Services, IT Communication at AGCS. “The economic consequences of the pandemic could fuel further political and social unrest in 2021 and beyond, with potential implications for supply chains and business interruption.” 

allianz risk barometer 2021 covid impact
Source: Allianz Risk Barometer 2021
Figures represent the percentage of answers of all participants who responded (2,769). Figures do not add up to 100 percent as up to three risks could be selected.

Strengthening resilience

The speed with which coronavirus spread across the globe took everyone by surprise. Companies too were caught unawares.

While many companies, including Allianz, set up dedicated Covid-19 response committees with representation from key corporate functions, many others struggled to keep their operations afloat. Last year, ‘business continuity plan’ might have been the most-heard phrase in corporate corridors. The focus has only sharpened since. 

About 62 percent of the respondents in the Risk Barometer believe that setting up or improving business continuity plans should be a priority.

According to Thomas Varney, Regional Manager of Risk Consulting, North America, at AGCS, the pandemic has shown that business continuity planning must become more holistic and dynamic. “Plans need to be constantly updated and tested, including having alternative suppliers available for raw and intermediate materials. They need to be cross-functional and integrated into an organization’s risk management and strategic processes.”

Even before Covid-19’s seismic power was felt, the rising complexity of global supply chains was becoming a cause of concern for companies. The sudden disruption in 2020 forced them to take a closer look at their supply chains. This year, about 45 percent of the respondents expect to develop multiple suppliers and alternative supply chains to prepare for exigencies. “In reaction to the pandemic, we are seeing clients make changes to their supply chains, including near-shoring (bringing production to a nearby country) and some reshoring and changing the locations of supplies, particularly for U.S. companies,” says Philip.

Efforts to build more resilient supply chains are welcome as they enable businesses to react quickly to market trends, says Georgi Pachov, Head of Portfolio Steering and Pricing at AGCS. “It’s not just about limiting insurance claims, more resilient supply chains should translate to more successful companies.”

Among other measures being considered are investments in digital supply chains; stricter supplier selection, audit and risk assessment; and inventory and safety stock management. 

allianz AGCS risk barometer 2021 covid impact actions
Source: Allianz Risk Barometer 2021
Figures represent the percentage of answers of all participants who responded (1,100). Figures do not add up to 100 percent as up to three risks could be selected.

Digitalization: A double-edged sword 

Cyber risks have been a growing concern for the past few years. Cyber incidents had replaced business interruption as the top risk in Risk Barometer 2020. This year, they slid to the third place after pandemic risk.  

However, accelerated digitalization in the aftermath of the outbreak has intensified cyber-related threats – be it from ransomware attacks or from technical failure or via the supply chain. According to a survey by McKinsey, companies may have advanced the digitalization of supply chains and operations by three to four years and the importance of digital products has accelerated by seven years.

Of course, there’s no denying that technology has its advantages. Enabling remote working, process monitoring or online sales and servicing, it serves as a useful tool for business continuity. Plus, digitalization of supply chains could increase transparency and potentially reduce the frequency of business interruptions.

However, digitalization brings the risk of more severe consequences when the underlying technology goes wrong. “Displaced workforces create new opportunities for increasingly well-organized and funded cyber criminals to exploit and gain access to networks and sensitive information,” says Georgi. “At the same time, the potential impact from human error or technical failure incidents – already one of the most frequent drivers of cyber insurance claims – may also be heightened.”

Once seen as an issue only for computers and software, cyber risks today pervade multiple spheres of life, from cars to factories to smart devices in homes. “Emerging areas like artificial intelligence (AI) – such as ‘deepfakes’, where realistic media content such as photos, audio and video is modified or falsified by AI – the digitalization of supply chains, automation and the ‘Internet of Things’, as well as new ways of working, could all provide opportunities for hackers and open up new vulnerabilities,” says Jens Krickhahn, a Regional Cyber Practice Leader at AGCS. 

The latest survey summarizes the responses of 2,769 risk management experts from 22 industry sectors. 

For a more detailed look at this year’s top risks and country-wise highlights, click here for the Risk Barometer 2021. 

About Allianz Global Corporate & Specialty

Allianz Global Corporate & Specialty (AGCS) is a leading global corporate insurance carrier and a key business unit of Allianz Group. We 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.

Our customers are as diverse as business can be, ranging from Fortune Global 500 companies to small businesses, and private individuals. Among them are not only the world’s largest consumer brands, tech companies and the global aviation and shipping industry, but also satellite operators or Hollywood film productions. They all look to AGCS for smart answers to their largest and most complex risks in a dynamic, multinational business environment and trust us to deliver an outstanding claims experience.

Worldwide, AGCS operates with its own teams in 31 countries and through the Allianz Group network and partners in over 200 countries and territories, employing around 4,400 people. As one of the largest Property-Casualty units of Allianz Group, we are backed by strong and stable financial ratings. In 2020, AGCS generated a total of 9.3 billion euros gross premium globally.


The Allianz Group is one of the world's leading insurers and asset managers with more than 126 million* private and corporate customers in more than 70 countries. Allianz customers benefit from a broad range of personal and corporate insurance services, ranging from property, life and health insurance to assistance services to credit insurance and global business insurance. Allianz is one of the world’s largest investors, managing around 706 billion euros** on behalf of its insurance customers. Furthermore, our asset managers PIMCO and Allianz Global Investors manage nearly 1.7 trillion euros** of third-party assets. Thanks to the systematic integration of environmental, social and governance criteria in our operations, business processes and investment decisions, we continue to be recognized as among the sustainable insurers in the Dow Jones Sustainability Index (September 23, 2022). In 2021, over 155,000 employees achieved total revenues of 148.5 billion euros and an operating profit of 13.4 billion euros for the group.

These assessments are, as always, subject to the disclaimer provided below.

*Including non-consolidated entities with Allianz customers.
** As of September 30, 2022

Press contacts

Heidi Polke
Allianz Global Corporate & Specialty (Munich)
Ailsa Sayers
Allianz Global Corporate & Specialty (London)
Lesiba Sethoga
Allianz Global Corporate & Specialty (Johannesburg)
Daniel Aschoff
Allianz Global Corporate & Specialty (Munich)
Sabrina Glavan
Allianz Global Corporate & Specialty (New York)
Florence Claret
Allianz Global Corporate & Specialty (Paris)
Camila Corsini
Allianz Global Corporate & Specialty (Sao Paolo)
Wendy Koh
Allianz Global Corporate & Specialty (Singapore)
As with all content published on this site, these statements are subject to our cautionary note regarding forward-looking statements:

Further information

Allianz Pulse 2022: Europeans united in pessimism

With COVID-19, inflation, energy crisis, food crisis, soaring prices, supply chain shocks, the war in Ukraine, and climate crisis, to name a few, it’s hard to see the glass as half-full. When thinking about the future and the current economic situation, the majority of respondents from Germany, Italy, and France in Allianz Research’s newly published Allianz Pulse 2022 survey seem to be united in their pessimism.

Fire, natural catastrophes and faulty workmanship

The analysis conducted by Allianz Global Corporate & Specialty found that over the past five years, fire and explosion, natural catastrophes and faulty workmanship or maintenance have been the major causes of loss by value of insurance claims.

The spring of discontent: global food crisis and the potential for civil unrests

The invasion of Ukraine in February 2022 has triggered a global food crisis with far-reaching consequences, according to the recently published report from Allianz Research. Without the millions of tons of agricultural produce flowing through Ukrainian ports, millions are at risk of food insecurity.