Willis has urged data centre owners and investors to rethink their approach to insurance, warning many may be buying more cover than their risk exposure warrants.

The broker’s call comes as investment in digital infrastructure accelerates to support AI and cloud computing, driving demand for increasingly large insurance programs.

It says availability is not a problem, with the global insurance market able to provide up to $US15 billion ($21.5 billion) of cover for large data centre risks.

But it questions whether simply “securing larger insurance towers” is the right answer for the sector.

“The focus should be on using data-led analysis to quantify and differentiate exposure to secure appropriate insurance limits,” Willis head of global specialties and global digital infrastructure group Alastair Swift said.

Willis says risks vary widely depending on factors including site location, power supply, construction methods, operational resilience, supply chains, and climate and cyber threats.

A more sophisticated understanding of exposures can help owners, developers, operators and investors tailor insurance program more appropriately, the broker says.

Risk engineering and resilience investments can better reduce exposure if carried out during the design phase.

Actions may include flood protection, enhanced wind and seismic design, wildfire mitigation, heat adaptation and other location-specific measures.