Insurance and reinsurance markets are confronting a new reality where technology risk is no longer confined to a single policy line. As artificial intelligence, data centres, and digital infrastructure expand, the potential for correlated losses that cut across property, casualty, and specialty lines has grown. In response to this shifting landscape, Gallagher Re has formally launched a Digital Risk Practice, a dedicated unit designed to help clients understand, quantify, and manage the accumulating exposures arising from an increasingly digital economy. This initiative brings together the broker’s established cyber expertise with new specialist knowledge in emerging technology risks, providing a single source of insight for insurers and reinsurers navigating an era where digital dependency is rewriting underwriting assumptions.
Digital Risk Practice Addresses Technology Exposures Beyond Traditional Cyber
Gallagher Re’s new Digital Risk Practice is built on the recognition that technology risk now permeates multiple insurance lines. The broker stated that the practice reflects a fundamental shift in how technology risk is affecting the insurance market. AI and digital dependency are no longer confined to standalone cyber policies, with technology exposures increasingly affecting property, casualty, and specialty business. The practice brings together Gallagher Re’s existing cyber capabilities with specialist expertise in these emerging technology risks. The broker said the initiative is designed to help clients understand, quantify, and manage technology-related exposures across insurance portfolios. The practice will work across Gallagher Re’s Global Products & Practices platform, giving the broker a dedicated structure for analysing these exposures and their potential accumulation.
Leadership Appointments Signal Focus on Emerging Risks
Ian Newman has been appointed as Global Head of Digital Risk, a role he will hold alongside his existing position as Global Head of Cyber. This dual appointment signals the close integration between the new practice and the firm’s established cyber capabilities. Freddie Scarratt has been named AI Liability Lead, a role he will hold alongside his position as Global Deputy Head of InsurTech, while Luca Drane will serve as Data Centers Lead. These appointments reflect the specific areas of technology risk that the practice will address, from the liability implications of AI systems to the accumulation potential of shared digital infrastructure. Newman said clients are increasingly seeking advice on AI and digital dependency beyond traditional cyber risk, suggesting that the traditional boundaries of technology insurance are becoming less relevant.
Data Centres Illustrate Accumulation Risk Across Portfolios
Data centres provide a clear example of the accumulation challenges that the Digital Risk Practice will address. A disruption at shared digital infrastructure can affect multiple businesses simultaneously, creating correlated losses across portfolios and lines of business. This is not merely a cyber issue; a physical event at a data centre, such as a power outage, fire, or cooling system failure, can trigger business interruption claims across a wide range of policyholders. The resulting losses can cascade through property, casualty, and specialty lines, creating a significant accumulation for insurers and reinsurers. The new practice will focus on helping clients understand these correlations and translate them into underwriting, accumulation, and capital insights. The aim is to support more informed reinsurance decisions as technology risks begin to influence capacity requirements and portfolio management.
AI Liability Creates New Underwriting Challenges
Artificial intelligence presents a similar challenge for insurers, as they begin to consider liability arising from AI systems alongside the wider operational and business risks associated with their adoption. The emergence of AI liability as a distinct risk category is a key focus for the Digital Risk Practice. Freddie Scarratt’s role as AI Liability Lead is dedicated to helping insurers understand how liability for AI systems might be allocated, whether it arises from algorithmic bias, autonomous decision-making, or system failures. This is a complex area where traditional liability frameworks may not apply directly. The practice will work to help clients understand the potential for AI-related losses to accumulate across portfolios, particularly as AI systems become more integrated into core business operations across multiple industries. The appointment underscores the importance of developing new analytical tools and frameworks for assessing AI-related risk.
Practice Focuses on Accumulation and Reinsurance Strategy
The practice will focus not only on identifying individual exposures but also on understanding how technology risks can accumulate across portfolios and potentially create large correlated losses. This is a critical distinction from traditional risk assessment, which often treats technology risks as isolated events. Gallagher Re’s specialists will help clients translate complex technology exposures into underwriting, accumulation, and capital insights, with the aim of supporting more informed reinsurance decisions. The move also positions the broker to advise insurers as emerging technology risks begin to influence capacity requirements and portfolio management. The launch comes as insurers increasingly look beyond cyber coverage to assess the wider insurance implications of rapidly expanding digital infrastructure and AI adoption. The practice provides a dedicated structure for analysing these exposures and their potential accumulation, giving clients a clearer view of how technology risk affects their entire book of business.
Single Source of Insight for Emerging Exposures
By bringing together expertise in cyber, AI liability, data centres, and digital dependency under a single unit, Gallagher Re aims to provide a coherent view of these interconnected risks. Newman stated that the practice provides a single source of insight to help clients understand emerging exposures, manage accumulation, and identify effective reinsurance solutions. This integrated approach is designed to help insurers and reinsurers avoid the siloed thinking that often characterises technology risk assessment, where cyber, property, and casualty risks are analysed in isolation. The practice will work across Gallagher Re’s Global Products & Practices platform, ensuring that clients have access to the full range of analytical tools and expertise needed to navigate the evolving technology risk landscape. The launch reflects a broader trend in the insurance industry, where the lines between different types of risk are becoming increasingly blurred as digital infrastructure becomes more pervasive.
The creation of the Digital Risk Practice by Gallagher Re signals a fundamental change in how the industry must approach technology risk. The days when cyber insurance could be treated as a standalone product are giving way to a more complex reality where AI, data centres, and digital dependency create exposures that cut across every line of business. This new practice provides a structured framework for understanding these exposures, not as isolated risks but as interconnected challenges that can accumulate across portfolios and demand new approaches to underwriting, capital management, and reinsurance. As digital infrastructure continues to expand and AI becomes more deeply embedded in the economy, the ability to assess and manage these correlated exposures will become an essential capability for insurers and reinsurers seeking to maintain a balanced portfolio and support their clients in an increasingly technology-driven world.
