Article ID: 3e3669ec59f37eb0d0ce2fb1fee6edf98bc06651e88c88093421157342b3a4f7
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Data center boom brings premium growth, aggregation risks - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Data center boom brings premium growth, aggregation risks by Gavin Souter Agents and Brokers , Construction , Cyber Risks , Emerging Risks , P/C Insurers , Technology Aon , EPIC , Liberty Mutual , Willis Towers Watson Oct 7, 2026 COLORADO SPRINGS, Colorado — Billions of dollars in data center construction are generating significant insurance demand, but a growing challenge for insurers is the accumulation of exposures rather than a broad shortage of capacity, insurance executives say. Most projects can obtain the property and builders risk capacity they need, but insurers and reinsurers must track overlapping construction, operational property, equipment and power exposures, they said. The executives spoke this week at the Insurance Leadership Forum, sponsored by the Council of Insurance Agents & Brokers. The boom has sparked public opposition in some states over concerns about electricity and water use and the effect on local communities, prompting proposals to restrict or pause some developments. Despite the pushback, insurance executives at the conference generally described data centers as a major growth opportunity for the industry. Thousands of data centers are expected to be developed globally, with many projects valued between $3 billion and $5 billion, said Ryan Barber, New York-based global head of property at Aon. There is ample capacity for projects of that size, which are generally highly engineered and attractive property risks, he said. “We’ve done placements now with limits as high as $8.5 billion, and that was over a year ago; we could probably do placements in excess of $10 billion now,” Mr. Barber said. Aon is developing an operational property insurance facility for data centers. Aon estimates data centers could generate more than $100 billion in new insurance premiums over the next five to 10 years, he said. But rapid development is creating accumulation issues as large campuses are built in phases, leaving insurers with builders risk and operational property exposures at the same site, Mr. Barber said. Other exposures can include high-value computer equipment and dedicated power generation, increasing the potential for insurers and reinsurers to accumulate exposures to the same projects. “The biggest struggle right now for insurers and reinsurers, for that matter, is to just track and understand the accumulation of risk that they’re taking on from these data centers,” Mr. Barber said. Managing aggregation is also an important consideration in site and insurer selection, said Pat Donnelly, Chicago-based head of risk and broking for North America at Willis. Some insurers can provide coverage across several phases of a development, while others prefer individual segments, he said. Insurers must consider those exposures alongside property risks already on their books, said Marc Orloff, Boston-based president of global risk solutions North America at Liberty Mutual. “We all write a lot of property already … so it’s all about managing tolerances. How much of our exposure do we want? How much volatility do we want on our balance sheets?” he said. Concentrations of expensive data centers in areas exposed to severe convective storms add to the uncertainty, Mr. Orloff said. Property and business interruption capacity remains plentiful for most projects, but capacity in other lines is more constrained, said Marc Kunney, San Francisco-based chief client officer at EPIC Insurance Brokers & Consultants. “Where some of the challenges are is on the professional liability, which is a much more limited marketplace,” Mr. Kunney said. The construction boom is generating substantial premium, but not all of the revenue will recur once projects are completed, Mr. Orloff said. Operational property coverage may generate lower premium volumes, while builders risk premium will decline if construction slows, he said. “It’s not a recurring revenue stream,” Mr. Orloff said. 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