Revealed – the top 10 future risks
Revealed – the top 10 future risks | Insurance Business America
Risk Management News
Revealed – the top 10 future risks
New report highlights regional differences
Risk Management News
By
Kenneth Araullo
While risks related to big data and artificial data are on the rise, climate change is still the number one concern for both experts and the general population, as revealed in the latest Future Risks report from AXA and market research firm IPSOS.
For the third year in a row, experts have voted climate change as the top future risk, only eclipsed by pandemics during the brunt of COVID in 2020. AI-related risks, on the other hand, found itself in the fourth top spot after not appearing in the top 10 at all in 2022. It previously made the top 10 future risks list in 2021 (10th), 2019, and 2018 (both 6th).
General cybersecurity risks followed climate change as the top future risks for experts, one rank higher than its 2021 placement. Coming up third is geopolitical instability, a risk more relevant now than ever as the struggle between Israel and Hamas continues. Rounding out the top five are energy risks, which fell one place from the ranking last year.
Meanwhile, on the general population side, pandemics are still feared as they ranked second in the top future risks report. Cybersecurity placed third for the general populace, while social tensions and energy risks rounded out the top five. Risks related to artificial intelligence and big data failed to crack the top 10 for the general population as it got beat by natural resources and biodiversity risks.
Future risks – what are the regional differences?
From a regional perspective, the AXA report showed that there are inconsistencies within the priorities for different risks. While climate change is still the top concern across all four regions (America, Africa, Europe, and APAC and the Middle East), the second highest ranking risk differs.
With the war in Ukraine on one front and the conflict in Gaza on the other, Europe has cited geopolitical instability as its second top future risk. For both America and APAC and the Middle East, which saw a surge in cyberattacks and other illicit activities in the cyberspace, cyber security risks ranked number two.
AI-related risks rank the highest in both America and APAC and the Middle East as well, where it reached the third top spot.
Do emerging technologies present more issues than it does solutions?
The report also polled both experts and the general population on whether the benefits provided by emerging technologies such as generative AI outweigh the risks that come with it. In Asia, more than half (52%) agreed with this sentiment, an outlook that reached its peak in China (57%).
However, the region that supported this sentiment the most is Africa, where 57% agree that technological advances create more risks than they solve. For Europe, only 46% agreed, while 49% polled in America shared the same concern.
Across all regions, both the general population and experts agreed, however, that there should be a break in AI and other disruptive technologies, with more than six in 10 experts sharing the belief and 70% of the general population agreeing as well.
Social tensions and inequalities will continue to be more prevalent in the future, the AXA report also noted, with three quarters of experts polled agreeing that they are becoming more serious over time. At the same time, 70% of the general population feels the same, with many agreeing that it will lead to fragmentation in countries.
A major focus for AXA despite insurance alliance exit
In addition to the report, AXA Group deputy CEO Frédéric de Courtois also spoke about addressing climate change as a major focus for the firm, a statement that comes following the insurer’s exit from the Net Zero Insurance Alliance (NZIA) a few months ago.
“Despite what you may have seen on the NZIA, the core of AXA’s climate strategy in 2024 will be very ambitious. On that particular note, as social players – as rational players – having an ambitious climate strategy for us is very important and part of our responsibility.”
Courtois also said that AXA’s attitude towards climate change as the top future risk is not global, and there are companies who do not share the same sentiment.
“This conviction is not shared by all players… This is what we see on the ground. Not everybody agrees about the climate strategy,” Courtois said.
“We feel that all risks deriving from natural disasters can be insured against. It’s a major risk,” he said. “We will continue to devote a large part of our capacity to insuring natural disasters.”
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