The explosive demand for AI capability has triggered a historic building spree across global digital infrastructure. As data centres become larger, more power-intensive, and increasingly mission-critical to modern business, operators and investors are rushing to hedge their exposure.
However, new advice from risk advisory firm Willis (a WTW business) warns that the sector’s current approach to risk management may be costing millions in wasted capital.
According to Willis, the global insurance market now offers up to US $15 billion in coverage capacity for large-scale data centre risks. Yet, driven by fear of downtime and complex supply chains, many developers and tech enterprises are simply buying the largest “insurance towers” available rather than accurately calculating their actual risk profile.
Buying Capacity vs. Building Resilience
“Buying more insurance is not always the same as being better protected,” explains Alastair Swift, Head of Global Specialties and the Global Digital Infrastructure Group at Willis. “When risks are properly modelled, understood, and mitigated, clients can build more efficient, resilient programs that reflect their actual exposures.”
As AI workloads scale, digital infrastructure faces a unique cocktail of vulnerabilities that standard property policies rarely reflect cleanly:
Hyper-local climate risks: Extreme heatwaves straining cooling systems, drought affecting water usage, and localized flooding.
Power & interconnectivity gridlocks: Increased pressure on regional energy grids creating severe business interruption risks.
Construction & supply chain lags: Delays in securing specialist hardware and high-voltage electrical equipment.
The Strategy Shift for Growing Tech & Infrastructure Firms
Rather than throwing capital at massive insurance limits to satisfy lenders, Willis urges growing businesses across the digital lifecycle to pivot towards data-led risk quantification and upfront engineering resilience.
Evaluating natural hazards and operational bottlenecks early in the site selection and design phase, such as building in advanced flood barriers or heat-adaptation measures, yields better long-term results.
Beyond lowering direct insurance premiums, this data-led approach delivers two critical business advantages for growing firms:
Stronger financing terms: Clear, evidence-backed risk profiling helps secure improved credit terms and S&P ratings from equity partners and lenders.
Smarter capital deployment: Reallocating capital away from unnecessary premium limits and directly into operational continuity planning.
The Takeaway for The Growth Hub Readers: Scaling fast in the AI era isn’t just about securing compute power or real estate. it requires evaluating site dependencies early. Business leaders who rely on evidence-led risk modelling rather than blanket coverage will preserve capital, reassure investors, and build far more resilient operations.
