Change to the legislative and regulatory landscape has emerged as the biggest risk facing Australian businesses this year, climbing two spots in an annual risk survey by Allianz Global Corporate & Specialty (AGCS).

About 36% of business executives name this as their top threat, fuelled by fears of fallout from the UK’s Brexit process, the US-China trade spat and growing protectionism.

Business interruption ranks second on the Allianz Risk Barometer at 32% and cyber incidents, last year’s top risk, are equal third with market development on 30%.

New technology places fifth, followed by natural catastrophes, loss of reputation or brand value, climate change and weather volatility, skilled worker shortages, and fire and explosion.

“Increased pace of change… in terms of legislation, regulation, market disruption and new technologies is heavily influencing business risk concerns within the Australian market,” AGCS Pacific CEO Pacific Willem van Wyk said.

“Australian organisations need to plan and prepare for a wide range of disruptive scenarios that can stem from their own operations, suppliers, IT service providers or new competitors.”

Worldwide, cyber incidents are up a spot to be the biggest corporate threat this year, sharing top place with business interruption.

The two risks each account for about 37% of responses from a record 2415 participants, including risk experts, in 86 countries.

Natural catastrophes retain third spot, driven by concerns over the economic toll of extreme weather.

“Increasing concern about cyber incidents follows a watershed year,” AGCS says.

“Cyber risk takes centre stage as businesses struggle with major system outages, large data breaches and an emerging conflict threat.”

Business interruption risks include Brexit and fallout from riots in France last November and December.

“Business interruption threats continue to evolve,” AGCS says.

“Moreover, businesses are facing an increasing number of disruptive [business interruption] scenarios as the nature of the risk evolves in today’s networked society.

“Many of these scenarios can occur without physical damage but with high financial losses.”

AGCS says the average business interruption property claim exceeds $US3.4 million ($4.7 million) and is about 39% higher than direct property damage claims.