Changes in Legislation and Theft, Fraud, and Corruption identified as top concerns for the Transport and Logistics sector in 2024

The transport and logistics sector is facing significant challenges in 2024, with changes in legislation and regulation, as well as theft, fraud, and corruption, identified as the primary concerns, according to the latest Allianz Risk Barometer.

They are followed by Business interruption (26%), Cyber incidents (23%) and Natural catastrophes (22%).  The report, based on insights from over 3,000 risk management professionals and business leaders, emphasizes the growing importance of addressing these risks to ensure business continuity and safeguard against potential disruptions.

The transport and logistics industry is particularly vulnerable to changes in legislation and regulation, which can lead to increased compliance costs, operational disruptions, and competitive disadvantages. Safety standards, emissions regulations, trade tariffs, and customs procedures directly impact transportation providers' operations, supply chain efficiency, and profitability. Furthermore, shifts in government policies regarding infrastructure investment, taxation, or labor regulations can affect transportation networks' capacity, reliability, and cost-effectiveness. To navigate the evolving regulatory landscape and sustain business resilience, proactive regulatory compliance strategies, stakeholder engagement, and advocacy efforts are crucial.

Theft, fraud, and corruption also pose financial losses, reputational damage, operational disruptions, and regulatory non-compliance risks to the sector. Cargo theft, fraudulent activities, and corrupt practices can result in the loss or misappropriation of valuable assets, goods, and sensitive information, impacting companies' bottom line and undermining trust among stakeholders. These illicit activities can disrupt supply chain operations, delay shipments, and compromise the safety and security of goods in transit. Enhanced security measures, due diligence processes, and collaboration among industry stakeholders are urgently needed to mitigate the impact of theft, fraud, and corruption on supply chain integrity and resilience.

Business interruption risks such as supply chain disruptions, natural disasters, and regulatory changes, also pose significant challenges for the transport and logistics industry. The top two causes of business interruption, following cyber incidents, are natural catastrophes and fire, with machinery/equipment breakdown or failure following closely behind. These findings highlight the interconnectedness and volatility of the global business environment, as well as the industry's reliance on supply chains for critical products or services. Consequently, improving business continuity management, identifying supply chain bottlenecks, and developing alternative suppliers remain key risk management priorities for companies in 2024. Additionally, maintaining strong relationships with suppliers, carriers, and partners, and conducting regular risk assessments to identify potential vulnerabilities, can help minimize the impact of interruptions.

With 23% of respondents expressing concern, cyber incidents have taken the lead as the most significant and new risk in the sector. The recent surge in ransomware attacks has resulted in a staggering 50% increase in insurance claims activity compared to 2022. Hackers are now targeting both IT and physical supply chains, launching mass cyber-attacks, and devising new methods to extort money from businesses. Consequently, early detection and response capabilities and tools have become increasingly crucial. Investment in detection, supported by artificial intelligence, is expected to enhance incident identification. Without effective early detection tools, companies may face prolonged unplanned downtime, increased costs, and a greater impact on customers, revenue, and reputation.

Natural catastrophes present additional risks to the transport and logistics industry, including damage to infrastructure, disruption of operations, and delays in supply chain networks. Climate change is expected to increase the frequency and severity of natural disasters, posing growing challenges for risk management, resilience planning, and adaptation strategies. To ensure the continuity of essential services, the industry must prioritize risk mitigation and implement robust strategies to minimize the impact of natural catastrophes on supply chain operations.

The Allianz Risk Barometer highlights the urgent need for the transport and logistics sector to address these key risks and implement proactive risk management strategies. By prioritizing regulatory compliance, enhancing security measures, investing in early detection and response capabilities, and adapting to the challenges posed by natural catastrophes, companies can safeguard their operations, protect their reputation, and ensure business continuity in an increasingly complex and volatile environment.


View the Allianz Risk Barometer methodology and full global and country risk rankings