Defective product or work, alongside crash and human error incidents, are the largest causes of liability loss for businesses
Liability losses in excess of US$1bn are becoming more commonplace, while collision and crash incidents are the main issues in Asia, according to a new report.
Allianz Global Corporate & Specialty (AGCS) warn in the report, Global Claims Review: Liability in Focus, that such large scale liability losses are no longer confined to the US and Europe, as regulators become tougher, supply chains more complex and US-style litigation spreads.
“We do see a trend towards greater liability claims outside the US with rising awareness of consumer rights and compensation in Europe and Asia, particularly in Japan, Singapore and China,” said Peter Oenning, Global Head of Liability Claims, AGCS.
The AGCS Global Claims Review analyses over 100,000 corporate liability insurance claims from more than 100 countries, with a total value of €8.85bn (US$9.3bn), paid by AGCS, and other insurers, between 2011 and 2016.
Collision and crash incidents were the top cause of liability loss in Asia, accounting for 48% of claims value in the region.
On a country level, in Singapore and Hong Kong, acts of an accidental nature or damage are the top driver of claims activity, accounting for 85% of liability claims in Singapore, particularly in aviation and shipping sectors, and 53% in Hong Kong.
Globally, the report identified defective product or work, alongside crash and human error incidents as the largest causes of liability loss for businesses, based on the analysis of insurance claims.
However, ‘everyday’ liability claims like slips and falls or workplace incidents have been reducing due to more stringent safety regulations and better risk management.
“Liability losses are ubiquitous and can range from minor incidents to major disasters, always causing third party damage or injury,” says Alexander Mack, AGCS Board Member and Chief Claims Officer.
“The risk landscape for companies is constantly shifting with liability risks on the rise globally.
“New technologies such as the internet of things, autonomous mobility or 3D printing will create fundamentally new liability scenarios for companies in almost every sector,” Mack added.
Top 10 causes of liability loss globally by total value of claims
1. Defective product/work
3. Human error
4. Accidental nature/damage
5. Slips/falls/falling objects
6. Water/fire/smoke damage
7. Environmental damage
8. Natural hazards
10. Property damage
Top causes of liability loss in Asia by total value of claims
2. Natural hazards
3. Accidental nature/damage
4. Defective product/work
5. Water/fire/smoke damage