Shepherd's Levine: Data center insurance market drawing carriers to MGAs, with bigger tests on horizon

By Isha Marathe Oct 13 (The Insurer) — The insurance industry's biggest challenge from the data center boom may emerge once facilities become operational, as new exposures involving downtime and contractual obligations test existing coverage products, said Shepherd CEO Justin Levine. Speaking to The Insurer TV at insurtech conference ITC Vegas 2026, Levine said the immediate constraints facing data center construction are largely driven by the unprecedented scale and volume of investment rather than a lack of suitable insurance products. From an underwriting perspective, data centers share many characteristics with conventional large-scale construction projects, requiring familiar property and casualty coverages, he said. Still, unique risks exist and Levine warned that the industry could face the bulk of them once the infrastructure begins operating. "I think that's where you're going to start to see more of a pressure test of the system," he said. Potential exposures include downtime, service-level agreements and the financial consequences of facilities failing to deliver promised computing capacity, raising questions about whether new insurance products, including parametric sol