A range of emerging risks, such as building safety laws and digital dangers including ‘hackers for hire’, top the trends heatmap for professional services firms, according to Allianz Global Corporate & Specialty (AGCS).
The professional indemnity insurer has identified these and other risks, including artificial intelligence (AI) tools, in a new report that also ranks them by level of anticipated impact, potential drivers of loss activity, and the likely ease with which these risks may be mitigated.
In comments published alongside the report, Diego Assef from AGCS said: “Although exposures vary, all these professions face a wide range of civil liability exposures which need to be adequately addressed and mitigated.
“These could range from accusations of negligence or omissions resulting in harm or damage to the client, to misrepresentation, to failure to identify fraudulent activity, to the unintentional breach of contract, intellectual property rights or confidentiality, and regulatory investigations and actions.”
Over the past 20+ years, AGCS has processed and handled more than 90,000 professional indemnity claims globally with a total value of €2.2bn.
For large losses (€1m+ claims only), solicitors/lawyers are most affected (30%), followed by construction professionals (27%), according to the insurer’s analysis.
Evolving legislation related to building safety and cyber crime, social engineering and data loss both topped the list of emerging risks.
AGCS pointed to the Grenfell Tower fire tragedy in 2017 and the ongoing campaign for reform of building safety legislation.
Extended liability periods for building and fire safety defects in the UK could bring new legal claims against manufacturers and suppliers, with a potential domino effect on all specialists in a construction project, ACGS explained in the report.
Cyber attacks, meanwhile, have increased in recent years and professional services firms are exposed due to the proprietary customer data and intellectual property the