A new report from WTW warns that the rising complexity of global supply chains, driven by digitalization and evolving risks like cyberattacks and supplier contract failures, is challenging the ability of insurers to accurately model and price coverage.
The firm’s 2025 Global Supply Chain Risk Survey, released this week, underscores a widening gap between traditional insurance practices and the shifting risk landscape faced by large companies.
Drawing insights from 1,000 senior executives surveyed in November 2024, the report reveals how businesses with annual revenues exceeding $250 million are reassessing their risk management strategies in light of increasingly interconnected and volatile supply chains. Respondents included risk managers, logistics leads, and senior executives, highlighting the need for cross-functional alignment in supply chain oversight.
One of the report’s standout findings is the growing prominence of cybersecurity and third-party contract risks in enterprise risk frameworks. As organizations digitize operations and rely more heavily on data, many are still developing comprehensive approaches to manage these emerging exposures, placing added pressure on insurers to adapt.
Hugo Wegbrans, head of Corporate Risk and Broking Europe at WTW, emphasised the consequences for underwriting and pricing. “The complexity of modern supply chains presents a unique challenge for the insurance industry, where risks must be thoroughly understood and accurately quantified to enable effective diversification and appropriate premium pricing,” he said.
“Proper risk quantification is essential to ensure that premiums reflect actual exposures, enhancing acceptable risk profiling, competitiveness, and the overall appeal of the market.”
The findings also suggest insurers may need to revisit how they model and price supply chain-related risks, particularly as clients demand more tailored and responsive coverage. As businesses place greater emphasis on resilience and continuity planning, the alignment between corporate risk strategies and insurance offerings is expected to become more significant.
Simon Sølvsten, head of Organizational Resilience Research at the WTW Research Network, added that the evolving nature of supply chains makes sustained oversight and adaptability critical. This dynamic, he noted, has implications for how insurers evaluate and support clients in building long-term resilience.
