By Heather Turner
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Equipment Failure Insurance
Rising risks and serious consequences have business leaders more concerned about the possibility of equipment failure, says FM Global.
Fortune 500-sized companies see equipment failure and cyberattacks on industrial control systems as causes of major concern, says new research from FM Global.
In a study commissioned by FM Global and conducted by Engine Group, 200 business leaders from companies with more than $1 billion in revenue were asked to weigh-in on equipment failure risks and business consequences. All respondents have responsibility for companywide oversight of equipment operations or equipment risk.
According to the survey, equipment failure is a top concern for 70% of respondents, with 43% believing the risk has increased within the past five years. Sixty percent see cybersecurity vulnerabilities of internet-connected industrial control systems as their top concern.
“The possibility of an equipment failure is weighing heavily on the minds of business leaders, and it should,” said Malcolm Roberts, executive vice president at FM Global, in a release. “A robust economy, turnover in the technical workforce and an increasingly potent cybercriminal community mean every company should be scrutinizing its potential vulnerabilities now.”
In the event of a critical equipment failure, 75% of business leaders said they expect it would take months for their companies to recover financially, with 14% of them predicting recovery would take years. Respondents cited other negative impacts a critical failure would have on their businesses, including:
54% expect a decline in revenue/earnings
50% expect the introduction of regulatory compliance problems
48% expect the degradation of brand/reputation
29% expect layoffs and/or loss of key employees
Read more of FM Global’s findings on its website.
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