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Allianz : Expected rise in strikes , riots and protests to test business resilience
Governments around the world have faced a growing number of strikes , riots and protests as people have had to cope with changes in many areas of their lives . Social inequality , the cost of living crisis and polarised politics are just some of the factors which have caused protests and strikes . Insurer , Allianz Global Corporate & Specialty , explains how operational and security management within organisations should view the current climate as a catalyst for evaluating best practices and policies around preparing locations and employees for potential civil unrest and building resilience .
Anger over growing social inequality and the cost of living , foundering faith in governments and institutions and increasingly polarised politics , together with a rise in activism and environmental concerns , are the main factors expected to fuel on-going incidences of strikes , riots and civil commotion ( SRCC ) around the world , according to a new report from insurer , Allianz Global Corporate & Specialty ( AGCS ). The heightened SRCC risk environment means businesses need to remain vigilant about the different threats such activity can pose . In addition to buildings or assets suffering costly material damage , operations can be severely disrupted , resulting in significant loss of income .
“ Incidences of strikes , riots and civil commotion have not only increased in recent years , they are also becoming more intense and catastrophic . These types of events are making our era one of uncertainty ,” said Srdjan Todorovic , Head of Political Violence and Hostile Environment Solutions at AGCS . “ We have seen multibilliondollar loss events in the US , Chile and Colombia .
“ The threat is changing , and although many of the reasons for it are universal – whether economic , political or environmental – it can play out differently in different regions , with various levels of violence and disruption . Operational and security management within organisations should view the current climate as a catalyst for evaluating best practices and policies around preparing locations and employees for potential civil unrest and building resilience .”
Civil unrest risks rose in over 50 % of countries between Q2 and Q3 2022 alone , according to the Verisk Maplecroft Civil Unrest Index – out of 198 countries , 101 saw an increase in risk . Since 2017 , more than 400 significant anti-government protests have erupted worldwide . It is unsurprising then that ‘ political risks and violence ’ ranks as a top 10 peril in the Allianz Risk Barometer in 2023 . While the Ukraine war is a major factor in this ranking , the results also show that the impact of SRCC activity ranks as a political violence risk of top concern with a combined score of almost 70 %. Unrest is now spreading more quickly and widely thanks in part to the galvanizing effect of social media . This means multiple locations can be impacted , potentially resulting in multiple losses for companies . Such events are also lasting for longer – almost a quarter of the 400 significant anti-governments protests since 2017 were in excess of three months – helping to ensure financial costs are mounting . Reported damages from just six civil unrest events around the world between 2018 and 2023 resulted in at least US $ 12 billion in economic / insured losses .
Five risk drivers of civil unrest
In the report , AGCS ’ political violence team highlight the five main factors they expect to power further SRCC activity in 2023 and beyond :
The on-going cost of living crisis : Although inflation is now thought to have peaked in many countries , the after-effects continue to take their toll . Just over half of protests globally in 2022 were triggered by economic issues , and public confidence in the financial future is shaky . Half the countries surveyed in the 2023 Edelman Trust Barometer showed a year-over-year doubledigit decline in the belief that their families will be better off in five years ’ time . Further protest activity is likely and although mostly peaceful , it can turn violent .
Distrust of governments and institutions : Governments thought to be corrupt or
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