Companies must prepare for more political disturbances and violence - AGCS
Damages, disturbances and, ultimately, losses from riots, protests, vandalism or other forms of civil unrest are now among the main political risk exposure for companies in the UK and worldwide. The ongoing impact of the Covid-19 pandemic will likely drive further activity, according to the latest issue of Global Risk Dialogue from Allianz Global Corporate & Specialty (AGCS). AGCS said that business continuity planning needs to proactively address political violence risks, particularly in highly exposed sectors such as retail.
“Fortunately, large scale terrorism events have declined drastically in the last five years. However, the number, scale and duration of riots and protests in the last two years is staggering and we have seen businesses suffering significant losses,” said Bjoern Reusswig, head of global political violence and hostile environment solutions at AGCS. “Civil unrest has soared, driven by protests on issues ranging from economic hardship to police brutality which have affected citizens around the world. And the impact of the Covid-19 pandemic is making things worse – with little sign of an end to the economic downturn in sight, the number of protests is likely to continue climbing.”
Topics covered in the Global Risk Dialogue magazine include the significant increase in the number of riots, demonstrations and vandalism, as terrorism events decline, which means civil unrest is now the main political risk exposure for companies, resulting in significant losses and insurance claims.
It also addresses the impact of political violence, which can cause business disruption beyond physical property damage, and the fact that the COVID-19 pandemic is likely to fuel further disturbances.
It discusses the need for business continuity planning to explicitly address civil unrest, particularly in exposed sectors such as retail. AGCS sees increasing interest in specialist political violence cover to mitigate risks.
“Previously this coverage was seen as a ‘nice to have’ for clients and ‘nothing to be overly concerned about’ by insurers. However, this has changed since 2018, as both the frequency and severity of these events has increased significantly. We see growing interest and demand for political violence covers from companies,” said Reusswig.
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