The rapid expansion of artificial intelligence, cloud computing and digital services is driving unprecedented investment in data centre infrastructure around the world. As these facilities become increasingly critical to the global economy, insurers and risk managers are reassessing how these assets are protected, placing renewed focus on accurate asset valuations.
Data Centres: A Rapidly Expanding Asset Class
Data centres now form the backbone of the digital economy, supporting everything from cloud services to financial transactions and AI platforms. Investment in the sector continues to grow rapidly as demand for computing power and data storage increases.
The scale of development is substantial. Modern data centre facilities can cost between $500 million and $2 billion to construct.
As infrastructure grows in size and complexity, so too does the opportunity for insurers. Analysts estimate the data centre sector could generate between $5 billion and $11 billion in annual insurance premiums in the coming years, reflecting the significant capital invested in digital infrastructure.
The Insurance Market is Responding
Recognising the scale of risk associated with data centres, insurers are expanding their coverage capacity and developing new insurance solutions tailored to this sector.
Insurers have recently increased limits available to data centre operators. One major insurer has expanded coverage capacity to up to $5 billion, the largest limits currently available in the market for these facilities.
Similarly, global broker Aon has expanded its Data Center Lifecycle Insurance Program to $2.5 billion in capacity, providing integrated coverage that spans construction, cyber exposure, operational damage and business interruption risks.
Why Accurate Valuations Are Critical
While insurers are increasing capacity, obtaining appropriate coverage still relies on one fundamental requirement: accurate declared asset values.
Data centres are highly specialised assets that include a complex mix of buildings, electrical infrastructure, cooling systems, backup power generation and IT equipment. Rapid expansion, upgrades and technological changes can quickly make existing declared values outdated.
If values are not regularly reviewed, organisations risk:
Underinsurance
Understating asset values can lead to reduced claims settlements, particularly where average clauses apply.
Inadequate business interruption coverage
Extended rebuild periods and specialist equipment replacement can significantly increase downtime following a loss.
Insurance placement challenges
As insurers tighten underwriting standards for high-value digital infrastructure, accurate and consistent asset valuations are becoming increasingly important.
Supporting Risk Management in a Digital Economy
As global reliance on digital infrastructure continues to grow, data centres will remain a key focus for insurers, investors and risk managers alike.
Ensuring asset values remain accurate and up to date is an essential component of effective risk management. Regular professional valuations allow organisations to demonstrate transparency to insurers, support policy placement and ensure adequate protection for these critical facilities.
