AI Data Centers Driving Growth in Captive Insurance
The rise of large-scale AI data centers is fueling significant growth in the use of captive insurance, a self-insurance model traditionally used by high-risk industries like oil and mining. These captives allow companies to manage their own risk portfolios rather than relying on traditional insurers. Michael Serricchio from Marsh notes that as these facilities expand globally—often located in areas with environmental risks—their scale is pushing firms toward captive solutions for coverage of construction, property, liability, and other exposures. Captive insurance offers businesses the ability to retain premiums instead of paying them out entirely to third-party insurers. This can turn what was once a cost center into a potential profit source. Over 6,000 captives now operate globally, writing about $240 billion in annual premiums—a significant increase from two years ago. Marsh alone manages around 1,900 captives for clients, collectively handling nearly $79 billion in premium. The shift is part of a broader realignment in the insurance market as companies seek more control over risk management and cost structures. Captive models are being adapted to cover AI infrastructure risks such as natural disasters or construction delays, with some firms exploring alternatives like self-insurance arrangements for specific projects.
Topics: AI data centers captives Marsh risk management