AI evolving into standalone insurance class, says Gallagher Re’s Newman

As AI, cyber and data-centre exposures become increasingly intertwined, Ian Newman explains why Gallagher Re is bringing them together under a new Digital Risk practice.

Key points:
AI could cluster cyber losses
Data centres cross traditional lines
Futures risks demand new aggregation models

Artificial intelligence cannot be considered in isolation from the data centres that support it, the cyber threats it can amplify or the liabilities it may create across other insurance classes. That growing overlap is precisely why the market needs to start thinking about digital risk differently.

Seeking to get ahead of that convergence, rapidly-growing global broker Gallagher Re has launched a dedicated Digital Risk practice spanning cyber, AI liability, data centres and digital risk engineering.

“You cannot really talk about AI without talking about data centres,” Ian Newman, who leads the new practice alongside his existing role as global head of cyber, told Monte Carlo Today. “Capacity matters, but this cannot just be about capacity; it has to be about understanding the risk.”

The rationale goes beyond grouping emerging technologies under one banner. As businesses become more digitally dependent, exposures that once sat within individual insurance classes are increasingly intersecting across them.

“If you look at where value sits in the world today, many of the most valuable companies are built around intangible and digital assets, and the way we operate is much more digitally focused,” Newman said.

That shift, he argues, requires insurers and reinsurers to rethink not only what they cover, but how those risks are priced and aggregated.

Rethinking risk aggregation

Cyber remains at the centre of the new practice, but Newman sees it increasingly as one part of a broader digital risk landscape.

He compares the current moment in AI with the emergence of cyber roughly 15 years ago, when a new technology wave forced the insurance market to determine how unfamiliar exposures fitted within existing products and models.

The difference now is the speed of change. “However fast we think technology has changed so far, it is going to change much faster from here,” Newman said.

Gallagher Re has been examining that convergence in its own research. Its Q1 2026 insurtech report warned that AI-related exposures can cut across general liability, D&O, E&O, employment practices and product liability simultaneously.

Newman says that creates an accumulation problem as well as a coverage question.

“We cannot necessarily think about accumulation in the traditional way,” he said. “We need to consider aggregation across different classes simultaneously and across different companies that may depend on the same technology.”

AI could therefore remain embedded within existing products while also developing into a distinct class.

“I foresee AI having a material impact on nearly every class while also potentially developing into an independent class of business in its own right,” he said.

Beyond the cyber lens

Data centres provide perhaps the clearest example of why those traditional boundaries are becoming harder to maintain.

Gallagher Re’s Q2 insurtech report noted that the pace, expense and technical complexity of data centre development are putting growing pressure on underwriters.

Cyber is one element of that exposure, but Newman argues it cannot be considered in isolation.

“When I talk about data centres within Digital Risk, I am not talking about them only through a cyber lens,” he said. “I am talking about the data-centre exposure as a whole.”

That brings property and other specialty risks into the equation. Gallagher Re's approach is therefore to create a central point of expertise while continuing to draw on teams across its existing divisions.

“We will have a dedicated team focused on data centres – asking what is changing, how the risks work, what products should be created and how the market should respond,” he said.

“Digital revolution represents one of the biggest growth engines we are going to see over the coming years and decades.”

AI changes the cyber equation

AI is meanwhile already influencing cyber risk itself.

Newman said Gallagher Re is seeing signs of AI enhancing what threat actors can do, allowing familiar attacks such as phishing and ransomware to be carried out at greater scale and sophistication, potentially with fewer resources.

“Our expectation is that this could increase frequency and potentially lead to greater clustering of losses,” he said.

That has implications for reinsurance purchasing. Newman argues that structures should respond to a client's risk profile and market conditions rather than be viewed as inherently attractive in isolation.

“It is about the right product for the right client at the right time,” he noted.

Despite softer cyber pricing and abundant capacity, he remains strongly positive about the class's longer-term prospects.

“I remain very bullish on cyber,” Newman said. “Businesses are increasingly going to want to protect what matters most to them, and more and more of that value is digital rather than physical.”

But he sees the opportunity extending well beyond cyber. “The digital revolution – whether you are talking about AI, data centres or other technologies – represents one of the biggest growth engines we are going to see over the coming years and decades,” Newman said.

For insurers and reinsurers, the challenge will be ensuring their understanding of risk evolves at the same pace.

Ian Newman is the global head of digital risk, and global head of cyber at Gallagher Re. He can be reached at: Ian_Newman@gallagherre.com

For more news from Monte Carlo Today, click here.

Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.