The world’s largest semiconductor companies risk being underinsured as the value of their plants and stockpiles of chips continues to rise sharply, according to Lloyd’s specialist insurer Atrium.
Its analysis of the 20 largest chipmakers found that property, plant and equipment rose 12% in the past year to $411 billion (all figures in USD), up from $368 billion. Inventories increased 14% to $118 billion, up from $104 billion. Combined, the two asset classes are now worth $529 billion.
Over 10 years, the increase is much steeper. Property assets are up 284% from $107 billion, and inventories are up 338% from $27 billion.
Atrium said chipmakers have built up record inventories and expanded production to meet booming demand, particularly from data centres and growth areas such as electric vehicles. The cost of developing and making advanced AI chips has pushed the value of their facilities to unprecedented levels.
Nick Leppard, head of property direct and facultative at Atrium, said cover that isn’t updated to reflect the rapid growth in facilities and stock could leave manufacturers short.
“Semiconductor companies have a huge amount of capital tied up in highly specialised facilities, so any damage to these facilities can result in dramatic financial losses,” he said.
Atrium pointed to recent losses. In 2025, an earthquake caused vibrations that destabilised chips being made by a large Taiwanese manufacturer, leading to a loss of $161 million after insurance recoveries. In 2013, smoke and soot from a fire caused a large Korean chipmaker losses of around $860 million.
Leppard said earthquakes are a particular concern because the specialist equipment at the heart of chip production is hard to replace, making restarting production after damage especially difficult. Typhoons and other natural disasters can also disrupt manufacturing processes that depend on extremely high precision.
The warning echoes other recent claims research. An Allianz Commercial study reported by Insurance Business last week found that the two costliest non-natural catastrophe events in its five-year dataset were both fires at semiconductor factories. It also identified underinsurance as a risk where insured values are not reviewed regularly.
The figures make a strong case for revisiting declared values. When asset values rise this quickly, a programme valued even two or three years ago may be significantly short. That can trigger average or leave a client paying for a large share of the loss itself.
Stock values can change quickly, so brokers should check whether policies use reporting clauses or declaration-adjustable cover that tracks inventory levels during the policy year, rather than fixing them at inception. Long lead times for replacement equipment also make business interruption indemnity periods critical, as Insurance Business has reported in the context of wider underinsurance trends.
The exposure goes beyond the chipmakers themselves. Data centre operators, electronics manufacturers and carmakers that depend on a small number of chip factories face contingent business interruption risk if a key supplier’s plant is damaged. That exposure is often harder to quantify and to insure.
