Willis Towers Watson Warns Data Center Operators Against Over-Insurance

The insurance broker Willis Towers Watson is warning data center operators that poor risk modeling is leading to over-insurance across the sector. While the global insurance market can provide up to $15 billion in capacity for large-scale risks, the firm argues that organizations often secure excessive coverage without quantifying their actual exposure.

This caution comes as the Swiss Re Institute projects global insurance premiums for data centers will rise from $10.6 billion to $24.2 billion by 2030. Willis Towers Watson advocates for a shift toward data-led analysis and resilience investments to determine appropriate insurance limits rather than simply chasing maximum market capacity.

These insurance trends mirror broader economic shifts driven by digital infrastructure growth. In Loudoun County, Virginia, the concentration of approximately 200 data centers has generated substantial tax revenue used to fund public schools and infrastructure. However, auditors from the Virginia General Assembly’s Joint Legislative Audit and Review Commission project that this growth could increase residential utility bills by $14 to $37 per month by 2040.