<div> SINGAPORE – <a href="https://www.media-outreach.com/" style="background-color: rgb(255, 255, 255)">Media OutReach Newswire</a> – 12 August 2026 – Artificial intelligence is driving one of the largest infrastructure investment cycles in decades, but the rapid global build-out of data centers is also creating a new era of construction, operational, climate and insurance risks, according to the latest Allianz Commercial The data center construction boom: risks and claims trends report. Annual investment in data centers is projected to double from around US$500bn in 2024 to more than US$1trn as early as <a href="https://images.intelligence.informa.com/Web/InformaUKLimited/%7B2149347c-a96a-45a6-aadd-009eb6aaea0f%7D_Cloud_and_Data_Center_Market_Snapshot_-_December_2025.pdf" style="background-color: rgb(255, 255, 255)">2027.</a> The investment opportunity extends far beyond server halls to electricity generation, grid infrastructure, cooling, networking, and semiconductors. According to <a href="https://www.allianz-trade.com/en_global/news-insights/economic-insights/Code-carbon-kilowatts.html" style="background-color: rgb(255, 255, 255)">Allianz Research</a>, the US and China are expected to account for around 62% of new global capacity additions through 2030, but the next wave of investment is becoming increasingly global. In Europe, Germany, the UK and Ireland remain major markets, but faster expansion is expected in Spain, Finland and Denmark, where power availability and permitting conditions can be more favorable. Across Asia Pacific, excluding China, installed capacity is projected to increase from around 9GW today to more than 28GW by 2030, with Malaysia expected to grow more than tenfold. </div> <div> "AI is turning the latest generation of data centers from a specialist real estate asset into mission-critical infrastructure," says Thomas Lillelund, CEO of Allianz Commercial. "The scale of investment is extraordinary and, as these centers evolve beyond traditional data storage to high-performance compute demands, 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. Indeed, comprehensive insurance cover has become a prerequisite for financing many large-scale AI infrastructure projects." Resilience must be central to data center operations The sector's biggest constraints are increasingly physical rather than financial. Competitive advantage is increasingly determined by access to electricity, grid connections, permitting, specialized equipment and skilled labor. In the US alone, the construction industry faces a shortage of around <a href="https://itif.org/publications/2026/01/12/construction-industry-facing-worker-shortage-driven-by-growth-of-data-centers/">439,000 skilled workers</a>, while an estimated 349,000 additional workers may be needed in <a href="https://www.ovabc.org/construction-workforce-shortage/">2026.</a> Climate resilience is increasingly a strategic consideration rather than an operational afterthought. Around 79% of global data center capacity is already located in areas exposed to heightened natural catastrophe risk, while 54% is exposed to chronic heat and drought <a href="https://www.prnewswire.com/news-releases/79-of-global-data-center-capacity-faces-elevated-climate-risk-302804645.html">stress.</a> Some of the fastest-growing AI infrastructure markets are also among the most climate-exposed, including Northern Virginia, US, Johor in Malaysia, and Marseille, France. Acute flood, wildfire and wind exposure is highest in the Americas, affecting 86% of capacity, while chronic heat and drought stress is greatest in Asia Pacific, where 89% of capacity is exposed. Global data center insurance market will more than double by 2030 Insurance is evolving alongside the sector. As data centers assume a more critical role in infrastructure, comprehensive insurance cover has become a prerequisite for financing many large-scale AI infrastructure projects. Construction costs for a single AI campus can exceed US$20bn, with insured values rising substantially once high-performance computing equipment is installed. The global data center insurance market is projected to grow from around <a href="https://www.swissre.com/institute/research/sigma-research/sigma-insights-07-2026-insuring-ai-data-centre-risks.html">US$11bn</a> today to more than US$24bn by 2030, reflecting rapid capacity expansion, rising insured values and increasing operational complexity. Demand is expected to extend beyond traditional property cover towards integrated solutions spanning construction, engineering, property, business interruption, cyber and liability, while also creating new opportunities in areas such as energy resilience, operational continuity, and technology risk. Risk and claims trends: fire drives severity; water damage frequency Allianz Commercial analysis of insurance industry data center-related claims shows that fire is the leading driver of loss severity, accounting for well over 50% of around €700mn (US$800mn) worth of losses. Natural catastrophe activity ranks second, followed by willful acts, which include crime and cyber incidents, followed by power failure. Water damage is the most frequent cause of data center claims, followed by willful acts, fire, and equipment breakdown. Business interruption is the primary driver of claims severity by line of insurance, highlighting the significant financial impact of operational downtime. The data center risk profile is changing as facilities become larger, more complex, and more increasingly interdependent. Hyperscale and colocation of campuses can bring together multiple tenants, construction works, servers, supporting utilities and on-site infrastructure in one physical or operational space. A single event can therefore trigger claims across property, construction, business interruption, liability, cyber, and financial lines. Real-life claims case studies show that in hyperscale facilities, damage to external cooling systems, hot works-related fire damage, and a delay in start-up caused by power disturbances have each resulted in losses in the US$50mn to US$100mn range. "For insurers, the key question is not only the value of the building, but the concentration of value and dependency inside and around it. Power, cooling, batteries, fiber routes, testing and commissioning, and business continuity planning are all part of the same risk picture. Effective risk mitigation must begin early and continue throughout the data center lifecycle. Resilience must be designed in from the earliest planning stage," explains Christian Kolbe, Global Head of Construction Claims at Allianz Commercial. Clarity between policies essential to avoid ambiguity Data center projects encompass different project phases with several stakeholders and interests involved, which can create complications. During the construction phase, stakeholders include the owner, developer, contractor, and subcontractors, whereas in the operational phase, the stakeholders include the owner-operator, and potentially multiple tenants or end users. For example, different policies could respond to a hot works-related fire resulting in damage to a data center nearing completion, and this would impact different stakeholders. "Clarity is critical with an insurance claim," says Charlotte Field, Regional Head of Short-tail Claims, Asia, at Allianz Commercial. "Clearly documented handovers are essential between your construction all-risk policy and operational policy. There must be no ambiguity about practical completion, in order to avoid disputes over which policy responds to a particular event and the extent of cover." </div> Hashtag: #AllianzCommercial <a href="https://commercial.allianz.com/" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">https://commercial.allianz.com/</a> <a href="https://www.linkedin.com/company/allianz-commercial/" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/iconmonstr-linkedin-1-24.png" width="24" height="24" data-no-lazy="1">https://www.linkedin.com/company/allianz-commercial/</a>The issuer is solely responsible for the content of this announcement.<h4>About Allianz Commercial</h4>Allianz Commercial is the center of expertise and global line of Allianz Group for insuring mid-sized businesses, large enterprises and specialist risks. Among our customers are the world's largest consumer brands, financial institutions and industry players, the global aviation and shipping industry as well as family-owned and medium enterprises which are the backbone of the economy. We also cover unique risks such as offshore wind parks, infrastructure projects or film productions. Powered by the employees, <a href="https://www.agcs.allianz.com/about-us/financials.html" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">financial strength</a>, and network of the world's #1 insurance brand, we work together to help our customers prepare for what's ahead: They trust us in providing a wide range of traditional and <a href="https://www.agcs.allianz.com/solutions/alternative-risk-transfer.html" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">alternative</a> risk transfer solutions, outstanding <a href="https://www.agcs.allianz.com/services/risk-consulting.html" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">risk consulting</a> and <a href="https://www.agcs.allianz.com/services/multinational-insurance.html" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">Multinational</a> services as well as seamless <a href="https://www.agcs.allianz.com/claims.html" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">claims</a> handling. Allianz Commercial brings together the large corporate insurance business of Allianz Global Corporate &amp; Specialty (AGCS) and the commercial insurance business of national Allianz Property &amp; Casualty entities serving mid-sized companies. We are present in over 200 countries and territories either through our own teams or the Allianz Group network and partners. In 2025, the integrated business of Allianz Commercial generated around €17.3 billion in gross premium globally. <a href="https://commercial.allianz.com/" class="social-media-link"><img style="margin-right: 7px;vertical-align: middle;display: inline-block !important;width: 24px" src="https://release.media-outreach.com/Release/templates/images/socialMedia/generic_link.png" width="24" height="24" data-no-lazy="1">https://commercial.allianz.com/</a> <img src="//track.media-outreach.com/index.php/WebView/480524/44375" alt="" width="1" height="1" style="width:1px;height:1px;">

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Allianz:  Data center boom ushers in a new era of infrastructure risks and opportunities for insurers

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