SLA Insurance offers financing perks for data centres

Author: Carly Weller

Parametrix has launched an innovative insurance product specially designed for data centres which covers their commitments under Service Level Agreements (SLAs). The groundbreaking insurance provides immediate financial compensation for SLA defaults, significantly reducing overall risk exposure.

The protection, underwritten at Lloyd’s of London, enables data centres to secure more favourable credit ratings, directly enhancing financing terms – including lower interest rates. As a result, data centre projects are more financially attractive to lenders, operators,and tenants alike.

Downtime has a direct impact on a data centre’s revenue and financial stability. This challenge can limit financing options, making it difficult for operators to optimise funding structures. SLA Insurance for Data Centers from Parametrix directly addresses this issue by providing immediate financial compensation if an insured’s SLA is breached.

This new parametric insurance coverage provides critical financial benefits across the data centre ecosystem. Operators can unlock pre-paid or escrowed funds, and reduce financing costs by demonstrating secure, insurance-backed SLAs. Data centre developers can secure better financing terms and a lower total cost of capital by mitigating operational downtime risk. For investors, SLA insurance from Parametrix enhances confidence and provides financial certainty in cases of downtime by ensuring rapid financial recovery. Meanwhile, data centre tenants benefit from stronger, insurance-backed SLA terms, which improve reliability and reinforce trust in their infrastructure provider.

“Parametrix SLA insurance is a game-changer for the financial structuring of data centres,” says Jonathan Hatzor, CEO of Parametrix. “By removing the financial uncertainties associated with downtime, we help investors, developers and operators optimise capital efficiency, lower financing costs, and increase confidence in the stability of their assets.”

He continues, “With the rapid expansion of cloud services, AI computing and digital infrastructure, financing data centres is more critical than ever, impacting stock market valuations and institutional investment strategies. Our coverage serves as a strategic enabler, safeguarding investments against performance-related financial risks and driving long-term growth.”

With this new solution, Parametrix continues to redefine the role of insurance in technology infrastructure, making data centres more financially resilient and unlocking unprecedented growth opportunities.