SONAR 2021: New emerging risk insights

While the COVID-19 crisis dominates the risk landscape, other emerging risks and trends arise from developments in human-machine interaction, connected infrastructures, and ethics and sustainability.

Emerging risk themes and trend spotlights

This year's SONAR report addresses the long-term effects of the COVID-19 pandemic as well as a range of emerging risks and trends for the re/insurance industry. On climate change, we examine the risks around efforts in the insurance business to advance decarbonisation and net-zero emissions. We look at threats related to increasing human-machine interactions, including potential faulty health advice from wearables, the ethics of digital nudging, and innovations in urban mobility.

The COVID-19 crisis will leave its mark for years to come. We don't yet know the severity of the long-term health effects from COVID-19. During the pandemic, cancer screenings, surgeries and treatment were postponed which could result in higher death rates in the future. Economically, the pandemic widened income inequalities, hurting the middle class which struggles with higher unemployment and lower incomes.

COVID-19 also shaped the top two emerging risks this year. An immediate danger are mothballed facilities. Missed inspections and delayed maintenance increase the risk of larger accidents as operations resume at oil refineries, chemical plants, mines or power plants. The second big threat are "zombie" companies, which are unviable firms that stayed afloat thanks to COVID-19 support but may go bankrupt once pandemic relief ends.

New risks do not emerge during times of crisis alone. To regularly profile and think through new or changing risks, and their associated uncertainties, helps build societal preparedness for the future.
Patrick Raaflaub, Group Chief Risk Officer, Swiss Re

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