Data center construction: does your insurance match the project?

Data center projects bring together owners, contractors, utilities, and equipment suppliers on demanding schedules. High-value equipment may have long replacement lead times. Power and cooling systems must work together. Testing and commissioning can become critical points in the project.

Those details should be part of the insurance discussion from the start.

Start with how the project will be built

A program designed around a more traditional construction project may not reflect the equipment, responsibilities, or testing involved in a data center build.

Before work begins, bring the project scope, equipment schedule, contracts, and insurance documents together. Review how responsibilities move between the parties and where a loss or delay could leave the business exposed.

Four questions to bring to the review

Who is responsible for the equipment? Identify owner-furnished and contractor-supplied equipment, its value, and who bears responsibility as it moves through delivery, storage, installation, and testing. Ask how the proposed insurance responds at each stage.

What happens during testing and commissioning? Explain the testing process to your insurance team. Review relevant terms, conditions, and exclusions before assuming that a builders risk or liability policy addresses the exposure.

What could a delay cost? Consider replacement lead times, scheduled opening dates, and contractual obligations. A delay can create a business cost without creating an insured loss. Review the circumstances in which the proposed coverage would respond.

Do the contracts and policies work together? Compare the responsibilities accepted by owners, contractors, vendors, and other parties with their insurance arrangements. Identify questions while there is time to resolve them.

Keep insurance connected to project decisions

Changes to equipment, scope, or the construction schedule should prompt a conversation with your insurance team. The objective is to understand the exposure and the available coverage before a problem puts both to the test.

Working on a data center project? Talk with our Construction team about the insurance questions to address before work begins.