The Intersection of AI and Energy: New Opportunities for Insurance Agents

Artificial intelligence is more than just the buzzword of the year—it’s a transformative force reshaping industries worldwide. From healthcare to finance, AI’s potential seems limitless. But one sector experiencing a particularly significant shift is the energy market. As AI adoption accelerates, its energy consumption surges, creating both challenges and opportunities. This dynamic is sparking new investments in climate tech and presenting insurance agents with fresh avenues to support clients in these cutting-edge fields.

Energy Startups: A New Leader in Climate Tech

For the first time since 2020, energy startups have overtaken electric vehicle and battery manufacturers as the leading recipients of global climate tech investments. According to a recent report in Insurance Journal, venture funding for energy startups soared to $9.4 billion in 2024—a 12% increase from the previous year. This surge is driven by the urgent need to develop greener, more sustainable energy sources to power AI-driven operations, which demand massive energy inputs.

Among the standout sectors are geothermal energy and nuclear power. Investments in geothermal energy have nearly tripled, while nuclear power funding has doubled. Tech giants like Amazon and Meta are pioneering efforts to generate power on-site for their AI data centers, reducing reliance on traditional grids. These centers require immense energy to process data efficiently and sustainably.

There are increased levels of activity with battery energy storage systems and power generation storage systems in relation to large AI data centers; it’s growth that’s moving very quickly and reshaping the energy market.

How Insurance Plays a Pivotal Role

The shift toward renewable and self-sustained energy sources is creating unique opportunities for insurance agents. Unlike traditional construction projects, building facilities like AI data centers or geothermal plants requires specialized insurance knowledge.

These are very different exposure types that require coverage from construction through operational phases. You need experts who understand both the technology and the purpose behind these projects.

Key factors for agents to consider include:

• Specialized Underwriting: Projects involving battery energy storage systems, self-sustained hydroelectric power, or advanced geothermal technologies demand underwriting expertise that traditional construction underwriters may lack.
• High-Value Projects: Many of these facilities have total insured values ranging from $250 million to $500 million. This scale necessitates complex policies like Owner-Controlled Insurance Programs (OCIPs) or Wrap-Up policies.
• Technological Risk: The evolving nature of AI and energy storage introduces a steep learning curve for insurers. Partnering with experienced wholesale brokers becomes essential to navigating these complexities.

Trends to Watch in AI Energy Usage and Insurance

As climate tech investment stabilizes post-2023, energy startups remain a hotbed of innovation, particularly as AI facilities demand localized, reliable power generation. This goes beyond cost savings; it’s about ensuring efficiency, sustainability, and dependability.

Weather, wildfires, and other events cause disruptions to the electrical grid. Generating their own power gives these facilities the ability to maintain a dependable energy supply and deliver consistent performance to their clients.

Despite political uncertainty and slower funding growth, long-term projects already in development are likely to continue. This underscores the importance of equipping agents with the expertise needed to navigate these evolving markets.

Supporting Agents in a Rapidly Changing Landscape

For agents, partnering with an experienced wholesale broker like DOXA can make all the difference.

If agents don’t have the knowledge base to know where to go for these types of risks, that’s where a strong wholesale partner becomes invaluable. DOXA is uniquely positioned to guide agents through these challenges, offering specialized solutions tailored to the needs of AI-driven energy projects.

With expertise in nuanced underwriting, policy placement, and risk management, DOXA empowers agents to seize opportunities in this transformative space.

Bottom Line

As AI continues to drive energy demand and reshape climate tech, insurance agents have a critical role to play in supporting this evolution. By staying informed about industry trends and partnering with knowledgeable wholesale brokers, agents can position themselves as trusted advisors in this rapidly changing landscape.

Ready to explore opportunities in AI-driven energy projects? Contact DOXA today to learn how we can help you navigate these exciting developments.