Cyber Risks Top 2025 Business Threats as Climate Concerns Surge

Cyber incidents, including data breaches and ransomware attacks, rank as the top global business risk for the fourth consecutive year, according to the Allianz Risk Barometer 2025. Cyber concerns garnered 38 percent of survey responses, surpassing business interruption, which took the second spot with 31 percent. Natural catastrophes, climate change, and regulatory changes rounded out the top 5 risks, with climate change reaching its highest position since the survey began 14 years ago.

The growing dominance of cyber risks reflects the increasing reliance on technology. Data breaches were cited as the most concerning cyber exposure, followed by attacks on critical infrastructure and physical assets. Rishi Baviskar, global head of cyber-risk consulting at Allianz Commercial, said, "For many companies, cyber risk, exacerbated by rapid development of artificial intelligence (AI), is the big risk overriding everything else. It is likely to remain a top risk for organizations going forward, given the growing reliance on technology—the CrowdStrike incident in summer 2024 once again underlined how dependent we all are on secure and dependent IT systems."

Business interruption (BI) remains a key concern due to its interconnected nature with other risks, including cyber attacks and natural disasters. Supply chain disruptions in 2024, such as the collapse of the Francis Scott Key Bridge and Houthi attacks in the Red Sea, highlighted the operational and financial impacts of BI. According to Allianz, global supply chain disruptions now occur approximately every 1.4 years and can result in economic losses of up to 10 percent of product costs. Michael Bruch, global head of risk advisory services at Allianz Commercial, said, "The push for technological advancement and efficiency is affecting the resilience of supply chains. Automation and digitization have significantly accelerated processes, which sometimes overwhelm individuals due to the rapid pace and complexity of modern technology. However, when implemented effectively, these technologies can also enhance resilience by providing better data analytics, predictive insights, and more agile response capabilities. This is why building and investing in resilience is becoming critical for every company around the globe."

Climate change moved from seventh to fifth place in 2025, its highest-ever ranking, as 2024 became the hottest year on record. Extreme hurricanes, devastating floods, and severe droughts contributed to more than $100 billion in insured losses globally for the fifth consecutive year. Natural catastrophes ranked as the top concern in countries like Austria, Japan, and Turkey, which faced significant disasters in 2024, including a magnitude 7.5 earthquake in Japan.

Geopolitical risks, including trade wars and regulatory changes, remain a pressing issue for businesses. Political risks and violence ranked ninth overall but climbed to seventh for large corporations. Ludovic Subran, chief investment officer at Allianz, warned, "The effect of new tariffs will be pretty much the same as with (over)regulation: ramping up costs for all companies affected. However, not every regulation is inherently 'bad.' And more often than not it is the implementation of rules that make corporate life difficult. Not only the number of rules but also an efficient administration that makes compliance as easy as possible should be the focus. A thorough digitization of the administration is urgently needed. However, in 2025, too, we will probably still be waiting in vain for a corresponding digital strategy. Instead, trade wars are coming. The outlook is not rosy."