keystone
According to Allianz, artificial intelligence (AI) poses one of the world’s biggest business risks for companies. According to insurance companies, AI is a double-edged sword that can be both beneficial and dangerous for businesses.
In a new Risk Barometer released by commercial insurance company Allianz Commercial, AI has jumped from 10th to second place, behind long-time leader cybercrime.
The two are related, and criminal hackers are increasingly using AI in their attacks. However, according to Risk Barometer, the use of AI can also be dangerous for companies, even without malicious intent, for example if managers or employees make bad decisions based on incorrect data or information.
Three major risks are interrelated
Business interruption is the third biggest global business risk this year. This also relates to cyber-attacks. A common cause of business interruption is online extortion. Hackers paralyze a company’s computer systems with encryption and then demand large sums of money for decryption.
Allianz Commercial is a subsidiary of the Munich-based Dax Group. The company releases a “Risk Barometer” at the beginning of each year. The assessment is based on a survey of 3,338 experts from 97 countries conducted last fall. They include Allianz employees as well as executives and managers from other companies, risk and claims consultants, insurance brokers, and experts from industry associations.
Although respondents’ answers varied by country, there were no fundamental differences. AI risk was ranked 2nd in Switzerland, 4th in Germany and 1st in Austria.
AI is both a curse and a blessing
Therefore, AI is a double-edged sword. Most companies see this technology as an opportunity, especially in automated defense against malicious cyberattacks. But at the same time, many of the experts surveyed felt there was a great danger. AI carries ever-accelerating risks — “perhaps both a curse and a blessing,” said Michael Furscherer, regional business manager for Germany and Switzerland.
He said cybercriminals are using AI to perfect “social engineering” techniques to pose as managers and deceive subordinates. “This is done by writing highly customized emails that we want people to click on or do something else with, such as cloning, generating audio, or even forging videos,” said Cyber Claims Director Michael Dome. “The majority of attacks we see still require human involvement, typically employees, to enable the attack.”
AI poses dual external and internal threats to businesses
But Allianz managers say external attacks are only one aspect of the problem. The perfectly legal use of AI software by your own employees and managers also poses risks to your company. “AI, by definition, operates with some degree of autonomy, so the results may be inaccurate or fictitious,” said Alexandra Brown, commercial manager at Allianz.
“And if the results of AI are inaccurate or discriminatory, it can naturally lead to legal disputes and negative publicity, leading to damage to a company’s reputation and image.” Risks of AI itself also include copyright infringement if the software copies or uses protected information.
A wide range of other risks
Other risks in the world’s top 10 range from politics and nature to the traditional uncertainties of business life. Fourth place goes to laws and regulations, which refers to both U.S. tariff policy and other trade barriers, as well as the deplored bureaucracy in many countries.
In second place are natural disasters and climate change, followed by political instability and violence, and negative economic developments such as inflation, fires, and explosions. Uncertainty about market trends, such as new competitors, acquisitions, and other changes, comes in at number 10.
