Manuel Arrivé, Head of EMEA Reinsurance Ratings at Fitch Ratings, said the growth of data centres and digital infrastructure in general presents both an opportunity and significant risk for reinsurers due to potential exposure, accumulation risk and modelling challenges.
During Fitch’s 2027 Global Reinsurance Outlook webinar, Arrivé noted that reinsurers tend to take a very cautious approach towards data centres. He said accumulation risk is the main challenge reinsurers face.
He explained, “This is all new and untested for the industry. So they tend to have a very cautious approach.”
“They’re at the stage where they’re interested because there are not so many growth segments on the markets, but still balancing the risks and benefits from a strategic point of view and also from a risk appetite perspective.
Arrivé continued, “But the main challenge and main risks for reinsurers is the accumulation risk, where one incident can trigger claims from different policies, different clients, and that has consequences also in terms of modelling.”
Nevertheless, Arrivé highlighted the impressive scale of investment in data centres, with trillions of dollars expected to be invested in the sector in the coming years, creating a significant opportunity for the insurance and reinsurance industry.
“But the scale of the investments is just impressive,” he said. “Trillions of dollars in the coming years, and insurance capacity is stretched, so there will be reinsurers, captive, cat bond, sidecar. This is all crucial for everyone to participate to make the whole thing happen in 2027 and beyond.”
“So I would say it’s an area that we watch with interest. Like the rest of the market, there are also global implications for the economy and second-order effect that can trigger losses for the sector. So more to come next year,” stated Arrivé.
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