Aon CEO Warns Data Center Insurance Risks Could Threaten AI Financing

The rush to build infrastructure for artificial intelligence is creating risks that could jeopardize the financing behind the data centers driving the boom, according to Aon CEO Greg Case. He made the comments in an interview with CNBC on Wednesday.

Case said that packing billions of dollars of equipment and computing capacity into a small number of locations could leave some projects hard to insure. "If you create them and you build them on top of each other, you've created concentration risk in a way in which it makes it more difficult to get insurance," he said. That, in turn, would reshape how projects are funded. "You can't access the debt markets," Case said.

The potential losses from outages are large. "Data centers are literally going to measure business interruption at millions of dollars per minute," he told CNBC.

The warning arrives as technology companies speed up spending on data centers, power generation and other infrastructure for AI. That spending offers opportunities for insurers, brokers and risk consultants, but it also raises the question of whether traditional insurers have enough capacity to absorb the exposure.

Aon's third-quarter results reflected the demand. The company reported a record pipeline of data center projects, and organic revenue in its commercial risk business grew 7%. Adjusted earnings per share rose 10% to $3.36, and adjusted operating margin widened by 70 basis points to 27%. Aon has created specialized insurance facilities, which are pools of capacity for particular industries or risks, including a $10 billion data center facility and a $2.5 billion energy facility. Case said risk management starts well before a policy is written, with Aon working with developers on design and location to limit business interruption and structure coverage that supports financing. "These are engineering conversations around understanding risk," he said.

Demand for sophisticated risk management also underpins Aon's pending $17 billion acquisition of USI Insurance Services, expected to close in the fourth quarter. Combined with Aon's existing operations and NFP, acquired in 2024, the deal would create a middle-market platform of roughly $6.5 billion. Case said mid-sized companies face the same increasingly complex risks as multinationals but often lack comparable analytics and expertise. Aon expects $395 million in annual earnings benefits from the combination, made up of $280 million in cost savings and $115 million in revenue synergies. The purchase will be financed with debt, and the company plans to prioritize reducing leverage over the next two years.

Asked why Aon is spending billions on acquisitions rather than only building technology, Case said the two go together. "This is about talent and technology," he said.

Case also addressed cyber risk, noting that AI is helping insurers understand vulnerabilities while introducing new threats. Researchers disclosed two critical flaws in PHP, a language used by roughly 70% of websites, on Oct. 21. The flaws could let hackers remotely run malicious code on vulnerable servers without authentication, and AI played a significant role in finding and analyzing them through cybersecurity firms Calif and Google's Wiz, along with OpenAI.

To keep pace, Case said, the industry must grow beyond its traditional capital base. He estimates global insurance capital at about $4.5 trillion and believes it must double or triple. He plans to draw on institutional investors, pension funds, sovereign wealth funds and wealthy individuals, which he estimates represent about $250 trillion in capital. Aon wants to act as "a market maker creating new markets," he said, though investors must be able to judge the potential for large, correlated losses.

On pricing, Case said falling rates in some commercial lines are not a lasting trend. "Some are confusing that with it's a permanent soft market. Not the case at all," he said. Some clients are using lower prices to buy more coverage, which has helped Aon keep growing despite softer pricing in commercial insurance and reinsurance.