Artificial intelligence has soared from 10th to second place in Allianz’s 2026 global risk ranking, signalling unprecedented concern among executives about AI’s operational, legal, and reputational impac
In a striking reversal of expectations, artificial intelligence has vaulted into the top tier of global business risks in 2026, leaping from #10 to #2 in the prestigious Allianz Risk Barometer survey. The annual ranking, polling over 3,300 risk professionals across nearly 100 countries, now positions AI just behind cyber incidents as the most pressing threat corporate leaders face worldwide. What this dramatic rise reveals is not just heightened concern about technology itself, but a profound shift in how companies must govern, integrate, and safeguard AI in a world where innovation and risk march hand in hand.
Risk Rankings as a Barometer of Change
Every January, the Allianz Risk Barometer provides one of the most authoritative snapshots of the evolving risk landscape confronting global businesses. Now in its 15th year, this annual survey aggregates insights from corporate risk managers, brokers, and insurance professionals to rank the threats most likely to disrupt operations in the year ahead. In 2026, the two risks at the summit tell a compelling story about the intersection of technology and uncertainty:
- Cyber incidents hold the #1 spot for the fifth consecutive year, cited by 42 % of respondents.
- Artificial intelligence (AI) surged to #2, cited by 32 %, up from tenth place in 2025, the largest year-on-year jump in the survey’s history.
These shifts reflect a world where digital systems and the technologies embedded within them define operational resilience, strategic advantage, and corporate trust. AI, once regarded mainly as an emerging opportunity, now stands shoulder-to-shoulder with long-standing concerns like business interruption, regulatory change, and natural hazards.
AI Leapt from #10 to #2
AI’s progression up the Allianz ranking is unprecedented. In 2025, AI barely registered among top business risks at #10. Today, it is second only to cyber. This sharp climb, a five-level leap, reflects how AI’s rapid integration into business processes has introduced a spectrum of risks:
- Operational complexity: As firms embed AI in core processes, systems reliability and data quality become mission-critical.
- Legal and liability concern: New legal exposures arise around automated decision-making, biased or discriminatory outputs, and unclear fault lines when AI outputs cause harm.
- Reputational risk: Errors or ethical lapses in AI systems can erode customer trust and damage brand reputation.
Ludovic Subran, Chief Economist at Allianz, captures this tension: “Companies increasingly see AI not only as a powerful strategic opportunity but also as a complex source of operational, legal, and reputational risk.”
What changed in one year is striking. In 2025, risk managers saw AI as an emergent force set to shape future strategy. By 2026, AI’s tangible deployment across analytics, automation, customer engagement, HR processes, supply chains, and even product design has transformed it into an acute source of potential disruption. The speed of adoption has simply outpaced governance structures, regulatory frameworks, and cultural readiness to manage its implications.
Cyber Incidents: Still Number One, but Intensified by AI
While AI’s ascendancy stole headlines, cyber incidents remain the top global business risk for the fifth straight year, and in 2026 they reached their highest-ever share of responses in the Allianz survey. Cited by 42 % of respondents, cyber risks encompass everything from ransomware and malware to data breaches and IT disruptions.
The rise of AI intensifies cyber risk in several ways:
- AI-powered attacks: Malicious actors increasingly use AI to automate attacks, craft sophisticated phishing campaigns, and bypass traditional defenses. AI can generate believable deepfakes and automate reconnaissance, raising the stakes for defenders.
- Expanded attack surfaces: As companies rely on AI tools that interact with cloud services, APIs, and third-party datasets, the potential entry points for cyber threats multiply.
- Skill gaps: Many organizations lack sufficient cyber talent to counter advanced threats, particularly as AI introduces both offensive and defensive complexity.
Michael Bruch, Global Head of Risk Consulting Advisory Services at Allianz, notes that reliance on external providers and AI-embedded technologies broadens cybersecurity vulnerabilities: “Organizations are increasingly reliant on third-party providers for critical data and services, while AI is supercharging threats, increasing the attack surface and adding to existing vulnerabilities.”
Thus, the twin concerns of cyber and AI are not separate spheres, they are convergent threats, shifting the risk calculus for boards, risk officers, and C-suite leaders worldwide.
Nuances: Regional and Industry Perspectives
One of the most revealing aspects of the 2026 Risk Barometer is how uniformly AI ranked across regions and sectors:
- In Asia Pacific, AI sits at #2 alongside cyber as the dominant business worry.
- In the Americas and Africa and Middle East, AI is also the second highest risk.
- In Europe, it comes in at #3 still a major concern across business sizes.
This cross-regional consistency reveals that concerns about AI’s rapid embedding into strategic and operational functions are not limited to advanced economies. Smaller and medium enterprises, often with fewer governance resources, also perceive AI risk as a pressing business challenge.
Industry sectors that once regarded AI primarily as an innovation opportunity, including finance, healthcare, manufacturing, and retail, now face risk discussions centered on:
- Accountability frameworks
- Model bias mitigation
- Data governance
- Regulatory compliance
- Liability attribution when AI decisions are flawed
In each context, the underlying theme is that AI’s transformative promise is accompanied by transformational risk.
What’s Driving Business Leaders’ AI Risk Concerns
The surge in AI risk ranking results from a combination of technological, organizational, and societal dynamics:
1. Rapid Adoption Outpaces Governance
Companies often deploy AI to stay competitive, improve efficiency, and unlock insights. Yet many organizations lack mature risk governance frameworks that align with this acceleration. AI systems can amplify latent biases, generate unpredictable outputs, and make decisions without clear human oversight, all conditions that undermine trust and expose firms to legal exposure.
2. Legal and Regulatory Uncertainty
Across jurisdictions, laws governing AI, especially generative models, automated decision-making, and algorithmic transparency, are still evolving. This regulatory ambiguity leaves corporations exposed to compliance risk and potential litigation, particularly when AI outputs affect customers or employees.
3. Reputational Stakes Are Higher Than Ever
Bad outcomes from AI, whether discriminatory lending decisions, misdiagnoses in health tech, or automated firings based on flawed scoring, can translate directly into reputational damage. For many firms, brand value is an asset that dwarfs balance sheet metrics; reputational harm can be harder to recover from than financial loss.
4. AI and Cyber Are Interlinked in Threat Vectors
AI is not only a risk in itself, it is increasingly a vector that shapes other risks, particularly cybersecurity threats. AI can generate highly effective phishing, mutate malware to evade detection, and accelerate exploitation of vulnerabilities. This reinforces why cyber incidents continue to dominate risk agendas even as AI climbs.
Strategic Imperatives for Business Leadership
What should corporate leaders take from the Allianz Risk Barometer’s findings? A few strategic imperatives emerge:
1. Build AI Risk Governance
Creating decision-making frameworks that govern AI deployment is no longer optional. Boards and risk committees must establish clear policies around:
- Ethical use of AI
- Bias testing and mitigation
- Explainability standards
- Human-in-the-loop controls
- Incident response protocols
These frameworks must evolve as AI capabilities and regulatory landscapes mature.
2. Integrate Cyber and AI Risk Management
Given the convergence, businesses must treat cyber and AI risk not as separate silos but as complementary parts of an integrated risk ecosystem. This means investing in cybersecurity defenses that anticipate AI-augmented threats and designing AI systems with built-in resilience.
3. Invest in Talent and Expertise
AI risk management requires interdisciplinary skills, from data science and machine ethics to legal compliance and enterprise risk strategy. Companies that invest in training and hiring talent with both technical and risk acumen will be better positioned to navigate emerging challenges.
4. Engage with Regulation and Public Policy
Proactive engagement with policymakers can help shape AI governance frameworks that balance innovation with responsibility. Industry coalitions, cross-sector initiatives, and public-private partnerships will be key to establishing norms that mitigate systemic risk without stifling innovation.
A Watershed Moment in Enterprise Risk
The 2026 Allianz Risk Barometer paints a clear picture: AI is no longer a distant frontier risk, it is a central business concern now. Its dramatic rise to the #2 global risk reflects not just the speed of adoption but the complexity of the challenges it introduces. Whether in legal exposure, operational resilience, reputational integrity, or cybersecurity intersection, AI’s risks are multifaceted and interconnected.
At the same time, this risk elevation does not diminish AI’s transformative potential; nearly half the respondents in the survey still believe AI will deliver net benefits to their industries.
What has changed is the collective corporate mindset: today, businesses see AI not only as a source of competitive advantage but as a critical risk to be proactively managed.
For leaders, this is a watershed moment, a shift from reactive risk mitigation to strategic risk governance that understands innovation is inseparable from uncertainty.
