Business Interruption Claims Now 70% Higher Than Property Damage

Global Insurance Desk: Business interruption claims now carry a much heavier financial punch than the physical property damage that sets them off, according to fresh analysis from Allianz Commercial. Looking at 7,888 insurance industry claims lodged between the start of 2021 and the end of 2025, the average business interruption payout has climbed above 850,000 euros. That figure sits roughly 70 percent higher than the average property damage claim of close to 500,000 euros. In dollar terms the gap works out to around 986,000 dollars against 560,000 dollars.

The total value of the claims examined reached about 6.74 billion euros, or 7.82 billion dollars. While the number of claims stayed fairly steady across the five years, their average size jumped by more than 30 percent a year during the final two years of the period. Fire and explosion emerged as the single most expensive cause, accounting for over 40 percent of the overall claim value and roughly 2.9 billion euros.

Nine of the ten largest man-made business interruption losses in the dataset were triggered by fire. The same pattern showed up strongly in major markets including the United Kingdom, the United States, Germany, Singapore and Hong Kong.

Non-natural catastrophe events, which take in fires, water damage and machinery breakdown, generated 74 percent of all claims by number and 66 percent by value. Natural catastrophes made up the remaining 26 percent of claims but a higher 34 percent of the total value, partly because recovery times stretch longer.

One illustration of the new reality is a relatively contained fire at a small manufacturing site that still produced a nine-figure business interruption loss across the wider corporate group once supply-chain knock-on effects took hold.

Allianz Commercial points to a mix of pressures pushing these numbers higher: more concentrated production, fragile global supply chains, geopolitical tension, persistent inflation and heavier reliance on digital systems. Even when the physical damage looks manageable, the cost of lost operations can quickly outrun it.

Thomas Lillelund, chief executive of Allianz Commercial, noted that the scale of the physical damage alone no longer decides the final bill. Companies need a clearer picture not only of their own critical assets but also of the suppliers, technologies and infrastructure they depend on.

The findings underline a growing challenge for both businesses and their insurers. Underinsurance linked to inflation and complex interdependencies is becoming more common, and claims can remain open for years while operations slowly recover.