Businesses are increasingly facing the growing risk of financial losses caused by interruptions to their operations. This is driven by various factors, including the concentration of production at fewer sites, fragile supply chains, geopolitical tensions, inflation and growing reliance on technology.
According to a new analysis by Allianz Commercial, the average total value of a business interruption claim now exceeds €850,000, around 70% higher than the average property damage claim, which is close to €500,000. The findings highlight how the cost of a business interruption can significantly exceed the cost of repairing the damage that caused it.
The study is based on an analysis of 7,888 insurance claims for business interruption, with a total value of around €6.74 billion, over the period from 1 January 2021 to 31 December 2025. While the frequency of claims remained relatively stable, their average value rose by more than 30% a year over the past two years.
Thomas Lillelund, CEO of Allianz Commercial, said:
“The risk of business interruption and supply chain-related risks remain high and highly volatile. Today’s business environment is characterised by geopolitical tensions, trade fragmentation, cybersecurity incidents and growing reliance on technologies such as artificial intelligence.
“The scale of the initial physical damage is no longer the only factor determining the final cost of an interruption. Even a relatively limited incident can have knock-on effects across production networks, customers and markets. For this reason, businesses need to identify and better understand not only their own critical assets, but also those of the suppliers, technologies and infrastructure on which their operations depend.”
Fire remains the leading cause of losses
Fires and explosions are the costliest cause of business interruption claims, accounting for more than 40% of the total value of losses analysed, or around €2.9 billion.
Fire was responsible for nine of the ten costliest man-made business interruption incidents in the sample and was the leading cause of losses in markets such as Germany, Singapore, the United Kingdom and the United States.
One example was a fire at a small manufacturing facility that caused limited physical damage but had a serious impact on downstream production activities, ultimately leading to a business interruption loss of hundreds of millions of euros at group level.
Natural catastrophes are the second costliest cause of losses, accounting for 34% of the total value of claims. They are also the most frequent cause, responsible for 26% of all incidents. Fires, explosions and natural catastrophes together account for more than 75% of the total value of claims.
However, incidents not linked to natural catastrophes remain the main driver of business interruption losses, accounting for 74% of claims and 66% of their total value.
Recovery is taking longer and costing more
Some claims linked to natural catastrophes now take much longer to settle. Two years after Hurricane Helene struck in 2024, many related claims remained open, not because of coverage issues but because affected businesses had not yet fully returned to normal operations. Supply chain delays, labour shortages and fluctuations in materials costs are extending both recovery and the claims settlement process.
At the same time, concentrating production in a limited number of facilities significantly increases risk. Entire industries depend on a small number of specialist facilities, suppliers or geographic regions for critical materials and components, meaning that a fire, cyberattack or extreme weather event can cause serious disruption to global supply chains. Notably, the two costliest incidents not linked to natural catastrophes in the analysis involved fires at semiconductor manufacturing plants.
Cyber risks broaden the threat landscape
While malware remains the leading source of cyber threats, a growing share of losses is now linked to outages of cloud services, software failures and incidents involving third-party technology providers.
In 2025 alone, more than 48,000 disruptions (outages) to cloud and software services were recorded, highlighting businesses’ growing reliance on digital supply chains. High-impact incidents, such as cyberattacks on software providers and logistics platforms, have shown that a single cyber event can disrupt the operations of thousands of organisations at the same time.
As businesses rely increasingly on cloud services, artificial intelligence (AI) applications and third-party technology providers, cyber-related business interruptions are becoming a more significant and complex source of financial losses.
According to Alberto Barani, Business Interruption Group Leader, Risk Consulting at Allianz Commercial:
“In today’s interconnected economy, preventing business interruption is no longer just about protecting individual sites. Although businesses have significantly improved their understanding of supply chain-related risks, prevention remains the most effective form of risk management.
Investments in fire protection, resilience to natural catastrophes, cybersecurity and business continuity planning can substantially reduce both the duration and severity of an interruption. Even relatively modest investments can significantly limit the impact of a disruption when one occurs.”