McGuireWoods partners Joseph Englert and Shelby Guilbert and associate Emma Leonelli authored a May 4, 2026, article for Law360 examining how escalating geopolitical tensions are creating significant insurance coverage considerations for AI-driven data centers and the companies that rely on them.
In “How Geopolitical Risk Affects Data Center Coverage,” the authors explained that modern hyperscale data centers face unique vulnerabilities to disruptions originating far beyond their own operations. Maritime incidents affecting oil transport, cyberattacks targeting digital infrastructure, and supply chain interruptions can all cascade into operational shutdowns — even when a data center’s own property remains undamaged.
The article highlighted two critical insurance coverage pathways — service interruption and contingent business interruption coverage — that may provide protection when geopolitical events damage third-party infrastructure such as tankers, pipelines, or power generation facilities.
The authors also addressed the complexities of state-sponsored cyberattacks, noting that many policies remain ambiguous as to whether such attacks fall within war exclusions, cyber exclusions, or neither. They discussed emerging AI-specific exclusions that some insurers are introducing, as well as strategies policyholders can use to preserve and maximize their coverage.
“The intersection of AI infrastructure and geopolitical instability represents a new frontier for insurance coverage,” the authors wrote. “For policyholders, the takeaway is clear: These risks are no longer hypothetical, and neither is the potential for coverage.”
The authors are members of McGuireWoods’ nationally recognized Insurance Recovery Practice Group. The article first appeared on the firm’s Pro Policyholder blog.