Financial, digital risks are most troubling to mid-market firms, QBE North America reports
When it comes to digital threats, cyberattacks are by far the risk that mid-market executives are most concerned with.
Mid-market organizations are less concerned by risks than they were last year, according to a survey from QBE North America, which reported financial and digital risks are the most pressing concerns for these companies.
Overall, 54% of mid-market executives said they were highly concerned about the 12 macro risks QBE asked about. This is down from 65% of executives that said they were highly concerned by the same dozen risks in 2022, and more in line with 2021 and 2020 levels, according to specialty insurer.
Fraud and theft were the financial risks most troubling mid-market execs, QBE North America reported. Other financial risks keeping these leaders up at night are operational performance, cash flow/liquidity, investment performance and the increasing cost of employee benefits.
When it comes to digital threats, cyberattacks are by far the risk that mid-market executives are most concerned with. This year, 45% cited cyber as the most troublesome risk they face. In comparison, the second-most pressing concern — extended system outages — was only cited by 12% of companies as a top risk.
Data integrity issues, compatibility issues, corporate espionage/theft of data, disruptive technology and IP theft/loss, respectively, were the other digital risks mid-market executives find concerning.
Preparedness reaches new low
QBE North America also reported that 43% of these companies have a risk mitigation plan in place, down from 46% in 2022, and 45% in 2021 and 2020. The decrease could be driven by the decline in overall concern for macro risks.
“The report’s findings show a clear contrast, with some mid-sized companies making strides in addressing their highest concerns, while the broader preparedness landscape still offers substantial room for growth,” Lucas Prahl, head of middle market at QBE North America, said in a release. “This necessitates a call to action, urging the development of more comprehensive and tailored risk management strategies. These strategies should address most concerns, empowering mid‑sized businesses to navigate challenges with resilience and strategic foresight.”
The survey also found that customized advice and products based on the industry or business was the most pressing need for mid-market organizations. Nearly 60% said customized advice was their biggest need, while 49% of mid-market executives said they could use more products designed specifically for their business or industry.
Although rates have mostly been up across most lines, the desire for more reasonable insurance rates actually fell 8% year-on-year, QBE North America reported, adding this sentiment might be driven by a sharper focus on coverage and value-added services.
Further, 13% fewer mid-market companies said they have unmet risk management needs this year when compared to 2022. This could be a reflection of less concern around macro risks as well as a function of the insurance industry placing more importance on this sector of the market, according to QBE North America.
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