The companies building America’s AI data centers are running into a problem money alone can’t solve: the insurance industry is close to the limit of what it can cover.

That’s the warning from Eric Andersen, president and chief executive of American International Group, who says the data center boom is maxing out property and casualty insurers. The math behind it is simple. A single hyperscale campus can be worth more than a mid-sized city’s entire commercial real estate stock, and it all sits on one plot of land. Markel’s Guenter Kryszon has warned that an individual campus can require $10 billion to $20 billion of property limit — far more than any one insurer will put on a single site.

Andersen has described a project that generates demand across an insurer’s entire product line, saying a data center needs roughly 30 different insurance products from permitting and financing through construction, including marine, liability, cyber and business interruption. He has called the buildout the biggest short-term opportunity the property/casualty industry has. The catch is that opportunity and capacity are now colliding.

The scale explains why. Zurich says the average data center project in its portfolio was worth $150 million five years ago; today it is $3 billion. The insurer has covered more than $350 billion of values across 250 data center projects over the past three years. AM Best counts 4,287 data centers in the United States as of May 2026, with the top 10 states holding 59% of them — Virginia leads with 603, or 14.1% of the national total, followed by Texas with 461.

Insurers normally manage risk by spreading it around. Data centers do the opposite. They pile enormous value into one location, often in states exposed to severe weather, and pack it with equipment that is expensive, scarce and hard to replace quickly. AM Best has flagged business interruption as potentially the most consequential exposure of all, and says the coverage the buildout requires already goes beyond what the traditional property/casualty industry has previously handled.

Power is part of the exposure too. A single modern AI data center can draw as much electricity as roughly 100,000 homes, and Lawrence Berkeley National Laboratory research cited by AM Best estimates data centers could consume as much as 12% of all U.S. electricity by 2028.

Andersen’s proposed fix is to widen the pool of money willing to take the risk. He has urged insurers and brokers to bring alternative capital providers — including the insurance-linked securities market — into risks the industry cannot absorb on its own, with data centers as the leading example. Brokers are already building structures to do it. Marsh launched a $75 million excess casualty facility for U.S. digital infrastructure construction in February.

That matters well beyond the insurance business. Lenders financing these projects require coverage before money moves. If insurers cap out on limits or price the risk higher, financing terms tighten and construction timelines stretch — which slows the buildout that hyperscalers and chipmakers are counting on.

AIG’s own quarter shows a carrier being choosier about where it puts capital. On his first earnings call as CEO, Andersen told analysts the market is moving out of a long stretch of broad price increases into a more selective phase where results depend on line-by-line dynamics, with new capacity from excess and surplus lines carriers and delegated underwriting structures pressuring property pricing in particular. In North America, AIG deliberately shrank the property book at its surplus lines unit Lexington in targeted areas, cutting premium retention there by nine points in the second quarter, while growing property where the returns hold up — including through its renewal rights deal with Everest. Andersen said the company is walking away from business that doesn’t meet its underwriting standards.

Andersen took over as CEO on June 1, succeeding Peter Zaffino, who became executive chairman, after joining AIG in February from Aon. His growth plan runs to five points: deploying capital toward the highest returns, using reinsurance efficiently, expanding artificial intelligence, holding expenses and investing in people. AIG is using its own AI tools to speed underwriting and claims, and Andersen said the goal is not fewer employees but employees handling more clients.

AIG grew net premiums written 24% year over year to $5.60 billion in the first quarter, helped by transactions, reinsurance changes and targeted organic growth.

JBizNews Desk | New York

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