Fast growth in data center construction is pushing up insurance demand and risks for the sector, a report published by Swiss on Friday said.

Global insurance premiums linked to data centers are expected to rise to $24.2 billion by 2030 from an estimated $10.6 billion currently, the report said.

Noting that building costs for a single site can exceed $20 billion, Swiss Re said financing institutions are pressing insurers to set limits that cover the full cost of construction.

However, the re-insurance and insurance industry can only support a fraction of this limit at competitive rates for traditional risk policies, Swiss Re added.

“This accumulation of value heightens the impact of physical risks, including natural catastrophes,” the report said.

Alongside natural disasters, there are also risks such as water damage from cooling failures and power supply interruptions.

Swiss Re expects over a quarter of U.S. data center capacity to be in areas with substantial exposure to hailfall and over 40% of capacity in areas significantly exposed to tornado risks.

(Reporting by Marleen Kaesebier. Editing by Dave Graham)