The artificial intelligence infrastructure race is producing one of the largest insurance challenges in a generation, and new claims data from Allianz Commercial shows the industry is still calibrating its response.
A report published by Allianz Commercial finds that annual investment in data centers is on track to nearly double from around $500 billion in 2024 to more than $1 trillion as early as 2027. The global data center insurance market is projected to grow from around $11 billion today to more than $24 billion by 2030. The US and China are expected to account for approximately 62% of new global capacity additions through 2030, making North America the single most consequential battleground for how the insurance market adapts.
The scale of the build-out is already generating claims, and the data shows the risk is more concentrated and more interconnected than many in the market had assumed.
Allianz Commercial's analysis of insurance industry data center claims found that fire accounts for well over 50% of around €700 million ($800 million) in analyzed losses, making it the dominant driver of severity. Natural catastrophe activity ranks second, followed by deliberate acts - including crime and cyber incidents - and power failure. Water damage is the most frequent cause of claims by volume, while business interruption is the primary driver of severity by line of insurance.
The nat cat exposure is growing as construction spreads beyond established hubs. In 2026, 64% of data center capacity under construction in the US sits outside traditional markets such as Northern Virginia, pushing projects into interior markets with elevated tornado, hail, and convective storm exposure. Allianz Commercial finds that around 79% of global data center capacity is located in areas with heightened natural catastrophe risk, while 54% faces chronic heat and drought stress. Acute flood, wildfire and wind exposure is highest in the Americas, affecting 86% of capacity.
Northern Virginia - the world's largest data center market - is itself among the most climate-exposed growth hubs identified in the report, alongside Johor in Malaysia and Marseille in France.
The labor market is adding another layer of construction risk. In the US alone, the industry faces a shortage of around 439,000 skilled workers, with an estimated 349,000 additional workers needed in 2026. Squeezed timelines and competition for specialized personnel can affect construction quality and increase the probability of the faulty workmanship claims that already feature prominently in loss histories.
The modern hyperscale data center is not a conventional property risk. A single campus can bring together multiple tenants, construction works, high-performance servers, supporting utilities and on-site infrastructure in one physical or operational space, meaning a single event can trigger claims simultaneously across property, construction, business interruption, liability, cyber, and financial lines.
Allianz Commercial's claims analysis shows that in hyperscale facilities, damage to external cooling systems, hot works-related fire damage, and power-disturbance-related start-up delays have each generated losses in the $50 million to $100 million range. Construction costs for a single AI campus can exceed $20 billion, with insured values rising substantially once high-performance computing equipment is installed.
Christian Kolbe, global head of construction claims at Allianz Commercial, said the underwriting question had shifted from building values to value concentration. "For insurers, the key question is not only the value of the building, but the concentration of value and dependency inside and around it," he said. "Power, cooling, batteries, fiber routes, testing and commissioning, and business continuity planning are all part of the same risk picture."
Brokers working with data center clients face a coverage picture that spans multiple lines simultaneously. Aon has expanded its Data Center Lifecycle Insurance Program to $5 billion in capacity, integrating construction, property damage, business interruption, cyber and liability coverage across the full asset lifecycle. S&P Global Ratings has estimated that data center insurance represents $10 billion in new premiums for 2026 alone, roughly double the size of the entire global aviation insurance market.
Thomas Lillelund, chief executive of Allianz Commercial, said insurance had become structurally embedded in AI infrastructure financing. "Comprehensive insurance cover has become a prerequisite for financing many large-scale AI infrastructure projects," he said. "Success will increasingly depend on resilience: access to power, reliable supply chains, robust construction controls, as well as climate-aware site selection and insurance programs that reflect the true accumulation risk."
For brokers, the practical implication is that data center risk cannot be placed through conventional property programs without leaving material gaps. Willis has warned that some facilities are actually over-insured in aggregate while remaining under-covered in specific areas - a mismatch that becomes visible only at claims time. Alastair Swift, head of the global digital infrastructure group at Willis, has said the focus should shift from securing capacity to understanding what is actually being covered. "When risks are properly modelled, understood and mitigated, clients can build more efficient, resilient insurance programs that reflect their actual exposures," he said.
The Swiss Re Institute's July 2026 sigma insights report on insuring AI data centre risks noted that large data centers are sometimes presented to insurers through separate programs - covering buildings, equipment and power plants independently - making it difficult for carriers to track overall exposure. When a single loss event hits, it can impact several programs simultaneously.
Allianz Commercial's central message is that resilience must be built in from the earliest planning stage. For brokers serving clients in construction, technology, real estate and financial services, the window to get ahead of that conversation is narrowing.
