The most common damages in companies and their rising financial impact
The primary causes of damage in industrial enterprises are fires, explosions, and natural phenomena. These damages thus also reflect the critical risks in the industrial sector. Fires, and any subsequent explosions associated with them, account for over 20% of all damages. Natural disasters closely follow, making up 15% of the total. Other frequent damages arise from insufficient maintenance or workplace collisions, accounting for 9%. Human error also plays a significant role in the ranking of damage causes.
The financial burden that damages impose on companies has been growing significantly in recent years. There are several reasons for this. One of the issues is cyber risks and increasingly frequent business interruptions due to disruptions in supply or customer chains. Such interruptions can impact many other companies that are connected to the affected operation.
Other factors also complicate the situation. Inflation primarily affects property and liability damages. The prices of materials and construction work itself have skyrocketed. Longer lead times for material deliveries, in turn, increase costs during business interruptions. The war in Ukraine also plays a role, as, for example, aviation insurance can be significantly impacted by this conflict.
Other insurance sectors, such as professional liability or D&O, are under price pressure due to rising legal representation costs, making insurance significantly more expensive while simultaneously narrowing the scope of coverage. Increasing insured sums in property insurance and a greater emphasis on risk management are thus an unavoidable reality that every company must consider and actively address. If you need an expert by your side to navigate the complexities of insurance and set it up correctly for you, do not hesitate to contact us. We are here for you.
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