Aon CFO on AI Data Center Boom, Catastrophe Bonds, and Q3 Earnings

Hurricane Melissa and Catastrophe Bonds

• 🌀 Hurricane Melissa's impact on Jamaica is discussed, highlighting the devastation of a category 5 storm.
• 💰 Aon's securities team facilitated a catastrophe bond (CAT bond) for Jamaica, designed to pay out over $150 million based on storm severity (specifically, central air pressure below 900 MBs).
• 💡 This parametric CAT bond, a parametric insurance-linked security, triggers payouts based on the storm's criteria, not direct damage, enabling quicker rebuilding funds.
• 📈 The global CAT bond and insurance-linked securities market is now approximately $120 billion, with Aon being a leader in structuring these deals.

Climate Risk and Insurance Gaps

• ⚠️ Globally, catastrophe losses amount to nearly $370 billion, with only about 40% ($160 billion) being insured, indicating significant protection gaps.
• 🌍 Aon provides analytics to help countries and corporations minimize volatility and build resilience through insurance protection and other capital solutions.
• 🏝️ Many island nations face similar insurance hurdles as Florida, with high costs and potential underinsurance or no insurance at all.

Aon's Q3 2025 Performance and Growth Drivers

• ✅ Aon reported a strong Q3 2025 with 7% organic growth and 12% adjusted EPS growth, meeting guidance.
• 🏗️ A significant growth driver is the commercial risk business, particularly in construction, fueled by the boom in AI and data center infrastructure build.
• 💻 Hyperscalers are investing heavily in data center infrastructure, with Aon's construction business experiencing double-digit growth due to expertise and hiring in this area.
• 🧑‍⚕️ Another key growth area is the workforce solutions business, addressing rising healthcare and benefit costs and helping companies attract/retain employees with new benefit plans.

The AI Data Center Investment Opportunity

• 🚀 The rapid growth of AI is driving massive investment in data center infrastructure, with hyperscalers spending tens of billions quarterly.
• 🇺🇸 The US leads in data centers (approx. 5,000), with significant global opportunities as well, where Aon has advised or brokered capital for about a third of US data centers.
• 🌐 Aon has established a data center lifecycle program offering end-to-end coverage and insights, from construction to cyber risks, positioning it as a key growth driver.
• 💰 The projected $2 trillion in data center capex over five years necessitates new capital beyond traditional insurance, with Aon's risk models helping to allocate exposure among insurers, reinsurers, and other capital providers.
• 🔒 Aon's expertise in construction, cyber, supply chain, and weather risk is crucial for the ongoing sustainability and protection of these massive, expensive data centers.