2026-09-16 · Source: ARTEMIS Reinsurance
Summary in 3 Points • Arbol CEO Sid Jha states that the data centre build-out requires rethinking risk modelling approaches • Parametric reinsurance is gaining momentum due to rising climate volatility and secondary peril losses • AI is increasingly deployed by insurers to enhance underwriting performance and operational efficiency --- As billions of dollars are invested in new infrastructure, particularly AI data centres, the re/insurance industry must reconsider its traditional risk modelling approaches, according to Sid Jha, CEO of Arbol. Jha, speaking after the 2026 Monte Carlo Rendez-vous, emphasised that data-driven solutions are crucial for managing climate volatility and enhancing resilience. The global expansion of data centres presents significant growth opportunities for insurers, but also introduces new risks that require adaptation. Jha noted that AI remains a key focus, with insurers leveraging it to improve underwriting and efficiency. Additionally, parametric reinsurance is gaining traction as a response to increasing climate volatility and secondary peril losses. For the **London Insurance Market**, the rapid expansion of data centres and the associated risks directly impact the **property and casualty** lines, where London syndicates play a significant role. The growing use of **parametric reinsurance** aligns with London's expertise in innovative risk transfer solutions, offering new avenues for managing climate-related exposures. As AI deployment becomes more prevalent, London Market participants need to consider how these technologies can enhance underwriting and operational processes, potentially affecting the competitive landscape. **Underwriters** and **brokers** in the London Market should prioritise understanding the evolving risk landscape associated with data centre infrastructure and climate volatility. Embracing **AI** and parametric solutions can provide a competitive edge in managing these complex risks. Additionally, as alternative capital, such as **insurance-linked securities (ILS)**, expands into new risk areas, professionals should explore opportunities for diversifying risk transfer strategies. Maintaining underwriting discipline amidst a softening market will be crucial to sustaining profitability and resilience.