Allianz: Artificial Intelligence Becomes the Second Biggest Threat to Companies Worldwide

 

Artificial Intelligence (AI) is transforming the global business landscape at an unprecedented speed. While companies are racing to adopt AI to improve efficiency, reduce costs, and gain competitive advantages, new risks are emerging alongside these opportunities. According to a recent report by Allianz, one of the world’s largest insurance and risk management companies, artificial intelligence has become the second biggest threat facing companies worldwide.

Why Allianz Considers AI a Major Risk

Allianz’s assessment highlights that AI-related risks have moved rapidly up the global risk rankings. Just a few years ago, AI was seen mainly as a technological advantage. Today, it is also viewed as a potential source of serious operational, legal, and reputational challenges.

The main concern is not AI itself, but how fast it is being adopted without sufficient controls, regulations, and human oversight.

Key AI Risks for Businesses

1. Data Privacy and Security

AI systems rely heavily on large amounts of data. Poor data management can lead to:

Data breaches

Misuse of personal information

Violations of privacy regulations such as GDPR

These incidents can result in heavy fines and long-term damage to a company’s reputation.

2. Cybersecurity Threats

AI is increasingly used by cybercriminals to:

Create more sophisticated phishing attacks

Automate hacking attempts

Generate deepfakes and fake identities

At the same time, companies that fail to secure their own AI systems risk exposing sensitive business data.

3. Legal and Regulatory Uncertainty

Governments around the world are still developing laws to regulate AI. This creates uncertainty for businesses, especially in areas such as:

Accountability for AI decisions

Intellectual property rights

Bias and discrimination caused by algorithms

Companies may face lawsuits or regulatory penalties if their AI systems cause harm.

4. Reputational Damage

AI-generated errors, biased decisions, or misinformation can quickly go viral on social media. Even a single incident can:

Erode customer trust

Damage brand credibility

Lead to public backlash

For global companies, reputational risk is often more costly than financial loss.

AI vs Traditional Business Risks

In the Allianz ranking, AI now comes just behind major risks such as cyber incidents, and ahead of traditional threats like supply chain disruptions or natural disasters. This shift reflects how deeply digital technologies are now embedded in everyday business operations.

How Companies Can Reduce AI Risks

Allianz emphasizes that companies should not stop using AI, but manage it responsibly. Key recommendations include:

Establishing strong AI governance frameworks

Regularly auditing AI systems for bias and errors

Investing in cybersecurity and data protection

Training employees on ethical and safe AI use

By taking these steps, businesses can benefit from AI innovation while minimizing its risks.

Conclusion

Artificial intelligence is no longer just a tool for growth—it is also a significant source of risk. Allianz’s warning that AI has become the second biggest threat to companies worldwide is a clear signal that businesses must act carefully and strategically. The future belongs to companies that can balance AI innovation with responsibility, transparency, and strong risk management.