Businesses and consumers agree that cyber risk is a top concern,says the 2016 Travelers Risk Index. According toTravelers Cos., 19% of businesses surveyed cited they“worry a great deal” about cyber, computer and technology risks and databreaches.

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However, cyber risks aren't business leaders' number one threat.Other risks on businesses' radars include medical cost inflation,increasing employee benefit costs and a changing workforce.

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Travelers worked with Hart Research Associates to survey 1,202 businessowners and decision-makers, including 493 small businesses (2 to 49employees), 453 midsize businesses (50 to 999 employees) and 256large businesses (1,000-plus employees).

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Overall, businesses are less anxious about the changing riskenvironment. According the the survey, businesses who viewed theenvironment as “more risky” dropped from 44% in 2015 to 41% thisyear. Specifically, large businesses dropped from 52% to 44%, andmidsize businesses went from 47% to 43%. Small business perceptionheld steady at 36%.

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Here are the top 8 concerns for businesses, according to the2016 Travelers Risk Index:

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8. Financial issues

Thirteen percent of respondents said they worry a great dealabout financial issues, including access to capital and cash flowrisks. In total, 43% of respondents said they worry a great deal orsome about financial issues. That number has declined from 49% in2015.

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7. Laws and regulations

Of those surveyed, 17% said they worry a great deal aboutunderstanding and complying with U.S. laws and regulations, and intotal 45% say they worry about it a great deal or some. Like mostthreats on this list, that number is down, from 51% in 2015.

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Among the top compliance risks worrying business leaders arethose associated with the continued rollout of the AffordableCare Act (ACA). The costs and expenses related to ACAcompliance worry 42% of businesses, while generally complying withthe ACA worries 37%.

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Concern about compliance with OSHA requirements and proposed cybersecurity legislation ranks slightly lower (33% and 31%,respectively). Small businesses report less concern about each ofthese risks, compared with midsize and large businesses.

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6. Broad economic uncertainty

Nearly half of respondents (48%) said they worry a great deal orsome about broad economic uncertainty. More specifically, 14% saidthey worry about it a great deal. This dropped slightly from 2015,when 51% of respondents said they worry about it a great deal orsome.

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5. Attracting and retaining talent

Attracting and retaining talent is another big concern amongbusinesses surveyed, with 15% saying they worry about it a greatdeal and half saying they worry about it a great deal or some.

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According to the survey, the greatest concern is retaining theworkers whose skills and experience businesses value (43% of allbusinesses worry about this). Attracting and hiring new qualifiedworkers is a close second (39%), followed by concerns about thecost and time involved in training new workers (37%).

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Business size is a factor in retention. Midsize and largebusinesses express the most concern, at 50% and 48%, respectively,and small businesses the least at 31%.

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4. Legal liability

Businesses' concern about legal liability dropped from 2015 when56% of respondents said they worry a great deal or some about therisk of being sued. In 2016, 51% of respondents said they worry agreat deal or some about legal liability, and 15% said they worryabout it a great deal.

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Specifically, professional mistakes, including errors andomissions (39%), rank among the top legal liability risks for allbusinesses, followed closely by employee lawsuits allegingdiscrimination, harassment, wrongful termination and otheremployment-related claims (36%).

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Other legal liability concerns include driving accidents causedby employees (30% of all companies worry about this), and faultyproducts or products that harm customers (24%). As is the case formany types of risks, says Travelers, midsize and large businessesare more likely than small businesses to worry about specific legalliability risks.

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3. Cyber, computer, technology risks/databreaches

Although overall concern about cyber risks declined from lastyear to third place across all businesses (58% in 2015 to 54% in2016), cyber threats remain the primary concern for largebusinesses. Sixty-one percent of these business leaders list cyberissues as the primary risk they face. This is driven by increasesin external data breaches or cyber attacks, reported by 23% oflarge firms.

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At 39%, small businesses ranked cyber risk in fifth place amongtheir worries. Midsize businesses listed it third, with 61%worrying some or a great deal about the threat. Among smallbusinesses, 89% said they have not experienced a breach or attack;80% of midsized businesses reported no breaches.

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Businesses worry more about malicious or criminal cyber attacks(56%) than they do about human error (23%) or system malfunction(22%).

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2. Increasing employee benefit costs

Employee benefits are keeping businesses up at night. Accordingto the survey, 21% of businesses worry a great deal aboutincreasing employee benefit costs, and 56% worry about it a greatdeal or some. This number has not changed from 2015.

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Forty-three percent of small businesses worry about risingbenefit costs, compared with 49% of large businesses and 70% ofmidsize businesses. Despite such a large number of businesses beingconcerned about rising benefit costs, 21% said they feel unpreparedto mitigate the risk.

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1. Medical cost inflation

A total of 59% of respondents said they worry a great deal orsome about medical cost inflation, with 25% saying they worry aboutit a great deal. Medical cost inflation continues to be No. 1,falling only one percentage point from 60% in 2015.

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However, results vary by business size, says Travelers. Only 50%of small businesses (2 to 49 employees) cite medical cost inflationas a major concern, compared with 52% of large businesses (1,000+employees) and 70% of midsize businesses (50 to 999 employees).

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Like increasing employee benefit costs, medical cost inflationis a risk many businesses do not feel prepared to deal with.According to the survey, while 59% worry a great deal about medicalcost inflation, 31% feel unprepared to manage the risk.

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