The rapid global build-out of data centres is also creating a new era of construction, operational, climate and insurance risks.

New research from Allianz Commercial has said artificial intelligence is driving one of the largest infrastructure investment cycles in decades, but the speed is creating new risks.

Its research, The data centre construction boom: risks and claims trends report, found  annual investment in data centres is projected to double from around $500 billion in 2024 to more than $1trillion as early as 2027. The investment opportunity extends far beyond server halls to electricity generation, grid infrastructure, cooling, networking, and semiconductors.

According to Allianz Research, 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 favourable. 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.

“AI is turning the latest generation of data centres 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 centres 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.”

Allianz added 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 labour. In the US alone, the construction industry faces a shortage of around 439,000 skilled workers, while an estimated 349,000 additional workers may be needed in 2026. Climate resilience is increasingly a strategic consideration rather than an operational afterthought. Around 79% of global data centre capacity is already located in areas exposed to heightened natural catastrophe risk, while 54% is exposed to chronic heat and drought stress. 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.

Insurance is evolving alongside the sector. As data centres 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 $20 billon, with insured values rising substantially once high-performance computing equipment is installed. The global data centre insurance market is projected to grow from around  $11 billion today to more than US$24 billion 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.

Allianz’s analysis of insurance industry data centre-related claims shows that fire is the leading driver of loss severity, accounting for well over 50% of around €700 million ($800 million) worth of losses. Natural catastrophe activity ranks second, followed by wilful acts, which include crime and cyber incidents, followed by power failure. Water damage is the most frequent cause of data centre claims, followed by wilful 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.

Christian Kolbe, global head of construction claims at Allianz Commercial explained: “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, fibre 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 centre lifecycle. Resilience must be designed in from the earliest planning stage.”