2026 risk outlook: what’s keeping risk managers awake at night?

Please find an article from our colleagues at RiskStop, a UK-based risk management provider specialising in scalable, data-driven solutions for insurers, brokers, and their SME clients.

As 2026 begins, risk managers across the UK are navigating a landscape reshaped by environmental volatility, workforce pressures and rapidly evolving regulatory expectations. Traditional property and liability risks remain, but they now intersect with emerging threats that demand more integrated and evidence-led approaches to organisational resilience.

“Risk managers are juggling more variables than ever,” said David Reynolds, Head of Risk Engineering and Surveys at RiskSTOP. “The challenge isn’t any single risk. It’s the way they interact, compound and accelerate one another.”

Extreme weather remains a primary concern. The Met Office’s most recent national climate stocktake confirms that record-breaking heat, heavier rainfall and more frequent storms are now “the norm” in the UK. The National Audit Office has warned that increasingly severe flood and storm patterns present mounting threats to property resilience and business continuity.

For those overseeing large estates or ageing property portfolios, this means heightened focus on flood exposure, structural vulnerability and the rapidly increasing cost of reinstatement. David Reynolds notes that the “new normal” of climate conditions is forcing organisations to reassess historic assumptions about property protection and maintenance cycles.

“We’re increasingly seeing organisations caught out by weather patterns that no longer resemble historic norms,” David Reynolds added. “One client saw a routine seasonal rainfall event overwhelm ageing drainage systems, causing widespread internal damage to a site that had never previously been considered high-risk.”

Liability exposures are also shifting. Analysis from Clyde & Co highlights that claim severity and legal costs continue to rise faster than general inflation, driven by what the sector refers to as “social inflation”. This has led to more expensive casualty claims, heightened litigation pressure and increasing expectations around organisational duty of care.

These pressures affect employers' liability, public liability and professional exposures, particularly for organisations with large workforces or extensive public interaction. “The liability landscape is tightening” explained David Reynolds. “Expectation levels are rising and organisations are being judged more critically on the evidence behind their decisions.”

Cyber remains a leading threat. Industry reports throughout 2025 identified sharp growth in supply-chain-driven cyber incidents, confirming that vulnerabilities in third-party vendors can be as damaging as direct attacks. This poses challenges for organisations reliant on outsourced operational functions or digital supply chains.

New AI-related risks are emerging at pace, particularly around liability, data accuracy and the safe operation of automated systems. As organisations accelerate adoption, uncertainty around accountability is becoming a key concern for risk leaders.

Business interruption continues to rank among the most disruptive exposures. Major insurers, including Allianz, have linked rising interruption losses to regulatory complexity spanning environmental standards, data governance, ESG reporting and product safety. With exceptions increasing across multiple fronts, organisations face broader exposure to enforcement, operational disruption and liability.

“Modern risk management requires visibility, foresight and evidence,” David Reynolds added. “Those that cope best will be the ones embedding practical controls, not just writing policies.”

Risk managers in 2026 aren’t kept awake by a single issue. Instead, they face convergence of environmental volatility, liability inflation, supply-chain fragility and escalating regulatory duties – all interacting in ways that make risks more connected, faster-moving and more complex.

As David Reynolds concluded, “Integrated resilience is the foundation of effective risk management in 2026.”

At RiskSTOP, we believe risk management is for everyone.