Data center work is everywhere right now. What’s less obvious is how thin the margin for error has become.
Demand continues to grow as companies invest in cloud, AI, and the supporting infrastructure. That growth is also driving larger facilities, heavier power requirements, and tighter coordination between utilities, owners, and contractors. In many cases, projects are being fast-tracked to meet aggressive timelines tied to capacity commitments, leaving very little room for delays.
These projects aren’t just bigger, they’re more technical, more compressed, and far less forgiving than traditional construction.
Schedules are tight. Commissioning timelines are rigid. Much of the equipment involved is highly specialized, owner-furnished, and subject to long lead times. Missed deliveries, failed testing, or power and cooling issues during start-up don’t just slow things down, they can push opening dates, trigger contractual penalties, and create downstream exposure for multiple parties on the job.
As project sizes increase, so does the exposure per build, especially as data centers cluster in the same regions to leverage power and water availability, further concentrating risk.
The insurance program doesn’t always reflect that reality.
I still run into builder’s risk and liability coverage that looks fine on paper but was designed for more traditional builds, not facilities packed with high-value equipment, complex mechanical systems, and strict commissioning requirements. When something unexpected happens, coverage gaps tend to surface quickly, whether the issue stems from physical damage, start-up delays, or disputes between contractors, vendors, and owners over responsibility.
In data center construction, the schedule gets the most attention. Insurance often doesn’t, until there’s a problem.
If you’re involved in these projects, it’s worth stepping back now, before a claim forces the conversation, to make sure coverage matches how these jobs are really being built.
Virtus National Construction Practice