Helping SMEs navigate a fast-changing risk environment

Risks change fast. At the beginning of 2026, many businesses were expecting more benign trading conditions as forecasts pointed to interest-rate cuts and easing inflation. However, the escalation of conflict in the Middle East has since reshaped the economic outlook, increasing uncertainty, pushing up energy costs and prompting the International Monetary Fund (IMF) to downgrade global growth forecasts while warning that a prolonged conflict could significantly weaken global economic activity. ⁽¹⁾

Companies have also had to rethink business interruption risk in the last couple of years. As well as checking the credentials of suppliers to reduce the risk of operations stalling if a business fails, it’s now important to have details of their cybersecurity measures too. This was highlighted in the 2025 cyberattack on Jaguar Land Rover where more than 5,000 businesses in its supply chain were affected when it shut down its production line ⁽²⁾. 

And although cyber has held the top spot in the Allianz Risk Barometer for the last five years, businesses have seen the threats shift dramatically in this space. Now, rather than launch a ransomware attack, cybercriminals might deploy double or triple extortion tactics, significantly increasing the cost and complexity of an attack. 

Significant shifts are happening in the regulatory environment too. These can have a major effect on business operations. 

New directives can mean a business needs to adapt its operating model or invest in new systems or support. Take the extension of the sugar tax to pre-packaged milk-based drinks as an example. Rather than swallow the tax hit, some manufacturers are expected to reformulate their recipes to duck below the new threshold.

New risks can come from overseas too. Few could have predicted the rollercoaster ride on tariffs when Trump declared it his favourite word, but as rates yo-yoed, business owners were left in the dark about what it would cost to sell to customers in the US.

Even businesses that only trade in the UK can be vulnerable to global political risk. A government being overthrown thousands of miles away may seem irrelevant to a shoe manufacturer in Solihull but, if sanctions are put in place or the new government introduces tougher trading regulations, it could potentially mean rewriting customer and supplier lists.  

Risks are more interlinked too, with one event potentially creating multiple exposures. The current Middle East crisis is a good example of this, with the effects felt far beyond Iran. 

As well as affecting supply chains and contractual arrangements as shipping is diverted from the region and airspace closed, the conflict is significantly increasing the price of oil. This will put pressure on transport and logistics businesses who use a lot of fuel, but also impacts inflation, slowing sales and pushing up costs, interest rates, borrowing, and goods.  

Closer to home, talent is another example of how risks are linked. Failing to attract and retain the right people can leave a business exposed to all sorts of risks. As examples, without technology expertise, there could be increased risk of cyberattacks or missed opportunities in the AI space; while, without sector savvy staff, changes to regulation could be missed, potentially leaving the business exposed to fines and reputational damage. 

Against this ever-changing and increasingly complex backdrop, businesses need to constantly horizon scan for emerging and evolving risks. Engaging with local business groups and trade associations can help them identify potential issues but, even with this support network, staying on top of risk can be a major challenge for an SME. 

Resource restraints mean they rarely have the luxury of a dedicated risk manager, with everyone focused on making the business a financial success and not fully appreciating how global tensions might affect them.

Business owners also need a firm grip on the insurance implications of any changes they make. Underinsurance is a significant issue, especially for a business responding to an ever-changing risk environment. Incorrect sums insureds, unrealistic indemnity periods or an incorrect valuation are common but can leave a business struggling to get back on its feet after a loss.  

And whether it’s underinsurance or a business risk they failed to identify, without the financial reserves of a large corporate, the consequences for an SME can be devastating.

With SMEs lacking the time or resources to manage risk effectively, brokers are a key business asset. By helping them stay on top of risk, whether that’s identifying an emerging threat, supporting them through business change, or advising on their insurance requirements, a broker plays an important role in their customers success. 

The following steps can help:

Maintain close contact with customers 

This helps identify emerging and evolving risks quickly and so appropriate action can be taken. Providing regular updates on key changes, whether to regulations, insurance products or  new technologies, can help manage risk. 

Encourage customers to share

SMEs are often nimble and will pivot between sectors, invest in new ventures or introduce lines without considering the insurance implications. Leaving this discussion until renewal can leave a business dangerously exposed.

Support with business continuity planning

Helping customers develop a strong business continuity plan not only builds resilience but also enables them to recover more quickly when disruptions occur. It’s a clear demonstration of good risk management and can strengthen an insurance application. At Allianz, our SME products include discounted business continuity planning through our partner Glen Abbot, giving clients practical support to prepare for unexpected events and remain operational all year round. We also offer discounted health and safety consulting, supported by easy to access e learning tutorials, helping customers reduce everyday risks more effectively.

Highlight business support tools

Many SME insurance products provide HR and legal helplines to help customers navigate day to day issues such as employment queries, disputes or contract checks. At Allianz, we take this a step further by offering customers access to Allianz Legal Services at no extra cost as part of Commercial Legal Expenses cover. This includes 100+ legal templates, an easy to use law guide, secure document storage and 24/7 legal and tax helplines covering topics from employment law to debt recovery and business tax advice. In addition, customers can upload any document and submit it for review and approval by a legal specialist.

Make use of insurers and the support they can offer

Insurers can significantly enhance the conversations you have with customers by providing access to risk management resources, tools and specialist expertise throughout the year. At Allianz, we offer a wide range of risk insights, practical guidance and technical support to help you and your customers stay ahead of emerging challenges and make confident, well informed decisions.

Delivering tailored risk advice to every customer is a major undertaking, especially when they operate across different sectors, each with their own unique challenges. At Allianz, we can support the conversations you’re having every day by giving you the tools, insights and expertise that help you guide customers confidently.

Our Smart Broker Brief plays a big part in this. Powered by more than 40 internal and external data points, it highlights potential exposures, identifies underinsurance, and provides customer specific risk management guidance. These meaningful insights help you deliver the proactive, informed advice your customers need.

A wide range of risk insights, practical tools, forms, checklists and technical guidance is available through our  Business Risk Support page, to help you support your customers and navigate an increasingly complex risk landscape. Covering key areas such as fire safety, working at height and Legionella control, these resources provide clear, actionable information that can help customers manage risks effectively and maintain safe, compliant and confident business operations.

Your customers can also benefit from hands-on support through our network of preferred suppliers. Whether they need fire suppression systems, security solutions or health and safety training, they can take advantage of specially negotiated rates – typically at discounts between 10% and 30% - with the reassurance that they’re dealing with a carefully selected and reputable supplier. 

They can also access specialist technical support through our UK Risk Engineering Team. With expertise across fire safety, natural hazards, property protection, health & safety and organisational risk, they deliver onsite surveys, risk assessments, tailored improvement plans and long term resilience strategies. Their knowledge and expertise help your clients truly understand their risks and take meaningful action to strengthen their operations.