Data Center Insurance Boom May Obscure Claims’ Difficulty

An S&P Global Ratings report published on April 13 projects that insurance premiums tied to data center construction and operations could reach $10 billion in 2026, with annual data center investment expected to surpass $300 billion by 2030. For insurers, this represents what S&P calls a “meaningful growth opportunity.” For the technology companies, developers and operators actually purchasing this coverage, the picture is more complicated.

The insurance industry’s enthusiasm for this emerging market is understandable. Individual data center projects may eventually carry insurable values as high as $30 billion, which would dwarf most traditional infrastructure projects. But the rush of carrier capital into the data center space should not obscure the reality that policyholders face a distinct and evolving set of risks that existing insurance products were not designed to address.