Data Centres
Specialist expertise, built around the asset
Gain clarity in one of the insurance market’s fastest growing and most complex risks.
Data centres are becoming larger, more valuable and more interconnected. Yet they are still frequently assessed using generic property classifications and incomplete asset information.
Renew Risk combines decision ready exposure data, specialist engineering services and purpose-built analytics to help insurers understand what is exposed, how facilities are configured and how damage could translate into prolonged downtime and severe financial loss.
WHY THIS MATTERS
A unique asset class requires a specialist approach
Data centres increasingly depend on, and interact with, renewable energy infrastructure. By 2030, it is predicted that data centre energy demand will increase by 170% to 219 GW.
A data centre is more than a building containing computing equipment. It is an interconnected system in which power, cooling, computing and operational infrastructure must work together continuously. The building itself only represents a limited portion of the total insured value: minor damage can cause major disruption. A failure affecting power, cooling, connectivity or a shared control system could interrupt services across an entire facility. At campus level, multiple buildings may also depend on the same external or centralised energy infrastructure.
A meaningful view of data centre risk must therefore consider:
Layout
Location of servers and other critical equipment.
Total Insured Value (TIV) breakdown
Building value relative to equipment value.
Interdependencies
Between shared systems, and potential single points of failure.
Business interruption
How relatively minor damage could cause extensive downtime.
RENEW RISK’S APPROACH
Data centres and the energy transition system
Renew Risk takes an asset-first approach to data centre risk. We combine our engineering expertise with sophisticated data capture and verification, and catastrophe risk analysis to examine how data centres are designed, operated and exposed. This gives insurers the relevant information needed for risk selection, pricing, capacity allocation and portfolio management.
We are developing an integrated suite of data, services and models, built specifically for data centre assets. Our approach begins with the characteristics that can materially influence damage and downtime, helping insurers understand their exposure - from individual facilities to entire portfolios.
Data
A purpose-built exposure dataset, capturing the characteristics that matter to insurers. Input is reviewed and verified from more than 35 data sources to support individual risk assessment and portfolio-level exposure analysis.
Models
Renew Risk’s academic research, exposure intelligence and in-depth analysis provides the foundations for catastrophe models that quantify damage and financial loss for these energy demand assets.
Services
Bespoke analysis for individual data centres, portfolios or territories, anywhere in the world.
This can support technical underwriting, risk selection, scenario development, accumulation analysis and the assessment of non-modelled regions or perils.
ASSET INTELLIGENCE
It begins with asset insights
More data is not necessarily better. Insurers need relevant, verified and structured information that helps them differentiate one risk from another.
Web scraping alone cannot establish which asset characteristics are material, resolve conflicting information or explain how a facility’s configuration affects its vulnerability.
Renew Risk’s Industry Exposure Database combines multiple sources with asset-specific knowledge and engineering validation to:
Capture the characteristics that influence risk
Identify and communicate uncertainty
Filter out information that doesn’t support insurance decisions
Disaggregate facilities and campuses, where appropriate
Cross-check and verify data across independent sources
Maintain information as assets evolve and new data becomes available
Unlike typical property, up to 90% of a data centre’s total value lies in non-structural components such as its servers and cooling systems.
These systems are typically interconnected, meaning damage to a relatively small component could impact the entire facility. Insurers therefore need to understand the anatomy of a data centre, including:
Assets
Construction
Number of storeys
Layout and location of critical equipment
Rack arrangement
Systems
Operator and status
Power, cooling and equipment monitoring
Fire resistance
Power
Power requirements
Primary power source
Secondary / back-up power source
RISK MODELLING
Quantify potential losses with risk modelling
Purpose-built catastrophe risk modelling combines asset-specific exposure information with engineering-based vulnerability and hazard analysis.
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The greatest financial exposure for data centres lies in Contingent Business Interruption, with unplanned downtime costing $9k-$15k per minute. Capture stringent resilience and zero-downtime expectations.
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Sliding is often the most critical failure mode. Incorporate complex analysis of the site’s physics to determine floor-specific rack displacement.
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Incorporate configuration changes and hardware replacements that alter loading and result in structural consequences.
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Incorporate configuration changes and hardware replacements that alter loading and have structural consequences.
CONSULTANCY SERVICES
Investigate the risk
Specialist engineering and risk analysis services for questions that cannot be answered through our Industry Exposure Database or risk modelling alone.
Commission Renew Risk to investigate:
How the location of critical equipment impacts flood, earthquake or other natural hazard exposures
Shared infrastructure and common mode failures
Regional accumulation of data centre campuses
Dependencies on external power, water and connectivity
The interaction between data centres and energy infrastructure.
Individual site risk assessments
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Portfolio exposure reviews
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Scenario development
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Accumulation analysis
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Engineering-based loss assessments
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Bespoke data enrichment
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A secondary view of risk
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Individual site risk assessments | Portfolio exposure reviews | Scenario development | Accumulation analysis | Engineering-based loss assessments | Bespoke data enrichment | A secondary view of risk |
THE BENEFITS
From asset complexity to better insurance decisions
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Identify the asset characteristics that could materially impact risk, rather than relying on property proxies.
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Offset incomplete, inconsistent or inaccurate data with verified asset information, from cascading system failures (property damage) to replacement lead times (business interruption).
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Develop a more credible view of exposure, concentrations and potential losses.
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Identify risk concentrations across campuses, operators and regional portfolios. Ensure reinsurance covers combined losses by leveraging detailed exposure data to tackle clash risk.