Cyber risks, medical cost inflation and legal liability are among the top concerns for American businesses of all sizes, according to results from the 2015 Travelers Business Risk Index. There is also rising worry about global/political conflict and the impact of extreme weather events.
The survey, conducted by Hart Research, polled more than 1,200 business decision-makers across the country to better understand which risks they believe pose the biggest threat to their businesses.
More respondents are worried about medical cost inflation than any of the other risks in the index, with 60 percent of business decision-makers citing the issue as a cause for concern, down from 67 percent in 2014. Additionally, 33 percent of respondents said that medical cost inflation is among the risks they are least prepared to manage.
Fifty-eight percent of respondents are worried about cyber risks, which ranked as the second biggest concern for all businesses, up from fifth last year. Businesses are most concerned about malicious and criminal attacks (55 percent), followed by human error (24 percent) and system glitches (21 percent).
Among the types of malicious attacks most worrisome to businesses:
- 57 percent of respondents worry most about having their computers or data systems infected with a virus.
- 51 percent worry someone could gain access to their banking accounts or financial control systems.
- 50 percent worry about a security breach or someone hacking into their computer systems.
Legal liability-related risks continue to be a significant source of concern for business decision-makers, with 56 percent of respondents saying they are worried. Professional mistakes, errors and omissions are among the biggest concerns in this category, worrying 42 percent of respondents. Thirty-four percent of respondents cited employee lawsuits for discrimination, harassment and wrongful termination as a top concern, while 33 percent of respondents worry about both customer slips and falls and driving accidents caused by employees.
Global/political conflict is a growing concern for decision-makers, with about one-third of those surveyed (32 percent) citing it as a worry—eight percentage points higher than in 2014. One-quarter of respondents said political unrest is a larger concern today than it was five to 10 years ago, up four percentage points from 2014.
More than half (52 percent) of the respondents believe severe weather has become more frequent, but only 38 percent believe that is the case for their area, and even fewer (32 percent) believe it has increased the likelihood of damage to their business. The Northeast is the only exception, with 51 percent believing severe weather is more frequent in their area. However, only 50 percent of companies have a written business continuity plan and only 41 percent have a business disaster recovery plan in place to help rebound after a disaster.