Howden has warned of “elevated risks” facing the global economy this year, citing ongoing conflicts in Ukraine, the Middle East and geopolitical tensions elsewhere.

Outcomes of elections in about 60 countries, including in the US and India, could also affect economic sentiment, the broker says in its 2024 Geopolitical Risk Report, 2024: a turning point? 

The report portrays a highly complex and changeable risk landscape that traverses macroeconomics, geopolitics and technology, with economic uncertainty and an upsurge in armed conflict coinciding with a slew of high-profile elections this year. 

“2024 looks set to be a year that will shape global developments for some time to come,” Head of Research Julian Alovisi said. 

“Continued macroeconomic uncertainty, heightened geopolitical risk and a unique election cycle are indicative of the high-risk environment businesses have been navigating since the turn of the decade, as well as the importance of risk transfer in sustaining global commerce through such disruption.” 

The report says the risk of escalation in hot spot areas is ever present. 

“The war in Ukraine is now in its third year and the danger of intensification continues to pose a threat to global security. Contagion or prolonged disruption to shipping in the Middle East could likewise see risks escalate and reverse recent global disinflationary trends.” 

Howden says in times like these, businesses need to prepare for, and protect themselves against, escalating risks. 

“In doing so, they are encountering an insurance market receptive to supporting clients as competition yields increased capacity and relatively stable pricing,” the report says. 

“By stepping up at this time of instability, and maintaining coverage in high-risk areas, insurance is enabling commerce worldwide that allows ships to sail and businesses to invest. 

“More work nevertheless needs to be done for under-insured exposures that are particularly relevant today, like supply chains and non-damage business interruption.”