Swiss Re’s annual Sonar report flags a “multi-faceted” emerging risk landscape with issues ranging from geopolitical tensions over access to the Arctic to a dangerous reliance on artificial intelligence (AI).

The report, now in its 11th edition, highlights 17 new risks and trends across social, economic, environmental and technological areas, as the reinsurer notes global uncertainties facing the insurance industry.

“With Sonar, we aim to proactively engage our clients and industry stakeholders in discussion of emerging risks, as we find this is the best way to be prepared,” Swiss Re’s Group Chief Risk Officer Patrick Raaflaub said.

Among the noted risks, Swiss Re reports concern over growing tensions between global superpowers over control of sections of the Arctic Ocean that have opened due to melting icecaps.

The reinsurer says the potential of the “Arctic opening” to strengthen supply lines and create market opportunities has caused nearby countries – such as the US, Canada, Russia and Scandinavian nations – to place a growing priority on authority over the region, setting off a new area of geopolitical tension. 

“The concurrent increases in economic interests, environmental change and geopolitical tensions make the Arctic a hotbed for emerging risks and potential risk accumulation, “Mr Raaflaub said.

The report also notes concerns over solar radiation management (SRM) technology that aims to reduce the impact of global warming by limiting incoming sunlight. 

Swiss Re acknowledges promising results from the technology to achieve its goal but says unintended consequences of cooling the earth can see effects similar to climate change for many countries and carries the possibility of climate engineering being used as a weapon. 

“Its utility is to lower temperatures,” Swiss Re said. “However, if implemented and then suddenly terminated, the result of SRM could be fast temperature increases, bringing on related weather effects.”

Other risks identified in the report highlight an overreliance on machine learning and AI technologies that are susceptible to hacking and other harmful actors, a growing threat of animal diseases, and dangers with the digitalisation of embedded insurance.  

Click here to access the report.