Consultative Risk and Insurance Solutions for Data Centers

Alliant provides consultative risk strategies and data center insurance solutions for stakeholders across the project lifecycle, including:

• Owners

• Developers

• Energy infrastructure companies

• Project companies

• Lenders/investors

• Energy, procurement and construction (EPC) contractors

• General contractors

• Construction managers

• Joint ventures

• Major trade contractors

From site selection through long-term operations, Alliant works alongside clients to develop risk strategies that support successful data center and AI infrastructure project delivery and long-term resilience. Our consultative approach includes:

• Risk discovery: Identify and evaluate risks across every development phase before they impact the project from moving forward.

• Contract review: Review the major contracts and leases for insurance, indemnity, liquidated damages, liability caps, waivers, casualty provisions, cross-defaults and termination rights.

• Coverage architecture: Design customized data center insurance and risk financing strategies aligned with project objectives and the client’s unique risk profile.

• Underwriting file development: Position the project for the insurance market through disciplined underwriting submissions and comprehensive risk documentation.

• Market execution: Secure competitive insurance solutions by leveraging extensive market relationships and technical expertise.

• Claims advocacy: Provide dedicated support to expedite the claims resolution process and reduce the frequency and severity of claims.

• Operational transition: Adapt risk management and insurance strategies as projects move from construction into ongoing operations.

We assess the risks inherent in the vertical segments of data center and AI infrastructure projects to protect project capital. Our approach includes a review of the data center value chain cycle and its exposures at each phase:

• Plan check

• Design and review

• Procurement

• Construction

• Stabilization

• Operations and maintenance

Alliant evaluates project-specific exposures, including contractual obligations, supply chain disruptions, contractor capacity, cost escalation, claims potential and insurance market capacity, to help clients proactively manage uncertainty and strengthen project outcomes. As clients approach operability, we help ensure the performance commitments they make to customers are supported by appropriate contractual protections and insurance solutions.

Following a comprehensive risk assessment, our specialists determine effective risk transfer strategies and how to best position the project in the insurance marketplace. We develop the following insurance and risk solutions to protect data centers throughout each phase of project development:

• Builder’s risk

• Delay in start-up (DSU)

• Owner-controlled insurance programs (OCIP)

• Contractor-controlled insurance programs (CCIP)

• Owner's interest (OI) insurance

• Professional liability and design liability

• Pollution liability

• Cyber liability and operational technology (OT) coverage

• Cargo and storage coverage

• Surety bonds and subcontractor default insurance (SDI)

• Operational property insurance and business interruption (BI) coverage

• Service level agreement (SLA) analysis

• Parametric insurance

• Liquidated damages (LD) gap analysis

Data center insurance is a coordinated portfolio of insurance solutions that addresses the complex, mission-critical exposures associated with developing and operating a data center. Data centers uniquely combine real estate, cyber, construction, energy and environmental risk, therefore requiring specialized coverage across disciplines that extends beyond traditional commercial insurance programs. Strong data center insurance programs will:

• Provide protection through multiple insurance products, through one consolidated program, to capture the complex, mission-critical risks across the data center lifecycle.

• Integrate with the overall project schedule and protect project timelines.

• Evolve alongside key project milestones and align with the demands of highly specialized digital infrastructure.

Data centers require specialized insurance coverage because they combine high-value physical assets and complex infrastructure with strict customer uptime commitments, which can magnify the financial impact of an operational disruption. In the event of a power outage, cooling system failure or cyber event, a momentary disruption can have significant downstream impacts on clients and amount to billions of dollars in losses. As a result, data centers require insurance solutions specifically designed to address these interconnected operational and financial exposures.

Key risk considerations include:

• High concentration of servers and complex digital infrastructure

• Dependence on continuous power to serve hundreds to thousands of clients

• Potential for significant business interruption and revenue loss from downtime

• Complex construction, environmental, cyber and energy exposures

A strong data center insurance program addresses this range of risks by aligning coverage with the unique project requirements, personalizing the insurance to the data center to support their ongoing operations.

Data center developers and operators should consider the following insurance and risk solutions to protect their operations:

• Builder’s Risk

• Delay in Start-Up (DSU)

• Construction Wrap-Ups (OCIP/CCIP)

• Surety Placement, Interconnection Bonds

• Property and Equipment Breakdown

• Business Interruption

• SLA Risk Transfer & Liquidated Damages

• Parametric Loss Products

• General Liability

• Contractors Pollution Liability

• Cyber Liability

• Technology Errors & Omissions

• Environmental Liability

• Safety & Loss Control

Insurance supports data center construction and project financing by safeguarding critical capital investments and providing developers, lenders and equity partners with the confidence that mission-critical risks are being effectively managed. As data center projects transition into construction and operations, insurance ensures continuity of coverage, minimizes gaps and supports a seamless transition into stabilized operations.

Insurance plays a critical role in each stage of project development:

• Site Selection, Capital Raise and Land Acquisition: Insurance supports financing requirements, contractual obligation and early-stage risk transfer, helping projects move from planning to execution.

• Pre-Construction: Developer liability, environmental liability and surety solutions help address development risks and are often required before land close.

• Site Mobilization and Early Works: Builder’s risk and professional liability coverage become critical as construction activities begin and project exposures increase.

• Construction: Builder’s risk, delay in start-up (DSU) and wrap-up liability programs help protect against physical loss, project delays and third-party liabilities while supporting construction financing requirements.

• Commissioning and Operations: As facilities approach completion and become operational, property, equipment breakdown, business interruption and cyber insurance help protect critical assets and customer commitments against operational disruptions.

Yes, a comprehensive data center insurance program will include cyber and technology liability coverages as endorsements or standalone policies. Because of data centers’ dependence on complex digital infrastructure to power their operations, there are a wide variety of risks, from service outages to cyber attacks, that can trigger significant financial damage to the centers themselves and the clients they serve. Cyber and technology liability should be evaluated alongside construction, environmental, real estate and energy solutions as part of an integrated data center risk management strategy.

Data center operators can manage business interruption and revenue protection risk by developing a comprehensive insurance and risk management program at the onset of project development and leveraging business continuity planning throughout the project lifecycle.

A coordinated insurance timeline, integrated with the overall project schedule and aligned with key milestones, ensures end-to-end coverage that mitigates the impact of project delays. For example, business interruption, equipment breakdown and delay in start-up (DSU) policies help protect against lost revenue and increased expenses following an incident.

In addition to insurance, proactive loss control measures, such as preventive maintenance and implementing early-warning fire detection systems, help reduce the likelihood and severity of disruptions.

Operators should also evaluate Service Level Agreement (SLA) obligations and potential contractual liabilities associated with downtime. This will help data centers to proactively identify coverage gaps and secure the appropriate insurance solutions to reduce the likelihood and impact of service disruptions.