How Insurers Underwrite Delay from Site Conditions in Hyperscale Construction Projects with KorrAI's AI Co-worker

The world that insurers support is changing fast. Infrastructure and hyperscale construction are being built at a record pace. Data center campuses, warehouse complexes, logistics hubs, and renewable energy corridors are on the rise.

The global market for data center construction was at US$245 B in 2024 and is projected to reach US$371 B by 2030, growing at a CAGR of 7.2%.
BusinessWire

These projects demand something insurers have rarely had: clear visibility into site conditions and the ability to monitor what causes delays. Without it, underwriters struggle to assess the true financial exposure each project poses. The consequences show up as Delay in Start-Up (DSU) claims, often the largest exposure on a policy, and construction liability disputes that can stretch for years. These are some of the largest losses insurers absorb.

Yet insurers are being asked to underwrite tomorrow's complexity with yesterday's knowledge and tools. The gap between what's being built and what can be confidently evaluated is widening.

Insurance Workflows Need An Upgrade

When a submission for such hyperscale construction projects comes in, the underwriting process looks straightforward on paper:

1. The broker sends documents.
2. The underwriter screens the package.
3. A risk engineer reviews the technical material.
4. Additional information is requested.
5. A consultant interprets the evidence.
6. Everything circles back for final pricing and conditions.

But in practice, it’s complex. Underwriters start with partial information. Risk engineers are handed dense reports and unstructured documents without a clear risk summary of the site. This makes the case for physical site visits. And once things get on the ground, the process becomes logistically complicated and time-consuming. Consultants provide point-in-time interpretations based on limited evidence, but limited reports about changes over time throughout the project.

Throughout this loop, site condition risks remain inconsistent or scattered.

The strain is amplified by rapid additions to the portfolio as construction projects expand faster than ever. One engineer may review dozens of complex sites each week, leaving little room for in-depth analysis.

At the same time, climate variability is shifting groundwater patterns, intensifying shrink-swell cycles, and changing the behavior of soft soils that static reports cannot capture. Insurance is facing more site conditions, ground instability, and delay-related losses with less capacity to evaluate them. And there are repercussions that insurers face:

• Triage slows down when submissions are messy
• Inconsistent underwriting due to varying interpretations
• Engineering reviews become expensive or repetitive
• Exposures are accepted without full visibility
• Difficult decisions: what is covered and what is not
• Disputes over “differing site conditions.”

The need is clear on all ends. Insurers want speed. Engineers want accuracy. Compliance wants traceability. Traditional workflows force trade-offs amongst all three.

Loss Patterns in Infrastructure Projects for Insurers

Construction Liability

When ground-related failures surface years after completion: drainage issues, structural or foundational movement, the central question becomes: did the issue already exist, or did it emerge later? Without pre-bind evidence of site behavior, insurers are forced to navigate these disputes through a slow, costly, and often inconclusive process.

"It can take years to conclude whether the policy was profitable."

Delay in Start-Up (DSU Insurance)

For an owner’s loss to be covered under DSU, the delay must be directly caused by physical damage (landslide, fire, structural failure, or other insured events). Delays from other means (labor strikes, supply chain issues, poor management, or pre-existing conditions) are, in most cases, excluded or have limited coverage.

But this creates a fundamental challenge of constant progress monitoring throughout construction, so that insurers can distinguish covered delays from uncovered ones when needed. This task is generally outsourced to a specialized surveyor or multiple forensic engineering consultants.

The process seems good in theory, but when real claims arrive, the game changes completely. Retrospective progress analysis following an insured incident is time-consuming, costly, requires weaving together different data sources, reports, and, most importantly, cross-verification. It all comes down to finding the correct cause that triggered the event. Because a comparatively small insured physical damage can trigger hundreds of millions in DSU.

The Hidden Driver of Change Orders & Delays: Ground Instability

Behind many construction change orders and delays lie ground conditions: Foundation Movement, Drainage Failure, Grading Error, Groundwater Uplift, Undocumented Fill, and Long-Term Deformation.

These aren't edge cases; they're recurring patterns across data centers, logistics parks, energy corridors, and public infrastructure. The challenge is that the evidence required to understand them never exists in a form that insurers can use. There are three main reasons why accurate evidence remains unnoticed:

1. Sparse, Point-Based Data

Every submission depends on a handful of boreholes and a geotechnical report. Those boreholes are accurate at the exact points drilled, but they don't capture how bearing capacity changes 20-30 meters away, how groundwater moves seasonally, or whether sections sit on undocumented fill. Two underwriters reading different geotechnical reports for similar sites can walk away with entirely different interpretations. Decisions end up relying on professional intuition, not spatial visibility.

2. Fragmented Evidence with No Common Standard

Information is scattered across sources: bore logs, grading plans, CAD drawings, inspection notes, drone photos, soil lab results, and 150-300 page PDF reports. None aligns to a common format. None flows into a unified pipeline. Risk engineers have to spend considerable time piecing together basic facts about what the site is, how it evolved, and what might be hiding below the surface.

3. No Multi-Year Ground Behavior Record

Perhaps the biggest gap: insurers rarely see how the ground actually behaves over time. There's no multi-year deformation record, no history of terrain modification, no visibility into groundwater recharge patterns, and no ability to compare pre-event and post-event conditions.

These three gaps leave risk engineers and underwriters making judgment calls on partial or overwhelmingly scattered information. True costs only emerge years later through construction delays, post-construction failures, and long-tail claims.

‍

Existing Tools Each Solve a Fragment of the Problem

The issue isn’t a lack of inputs. It’s the absence of a single, auditable evidence layer that brings everything together: the specificity of borehole logs, the insights buried deep in submitted documents, correlation with wide-area ground deformation, site conditions throughout project phases, water risk, and historical changes.

Introducing TRAIL Playbooks for Insurance Workflows

What is TRAIL for Insurance?

TRAIL is an AI co-worker for insurers. It’s an agent that reads all the dense reports and unstructured documents, interprets satellite-derived ground motion maps, cross-references multi-hazard layers, and assembles all of it into an underwriting-ready package with clear, traceable reasoning.

It helps the underwriting team skip days of document hunting. It enables the claims team to evaluate site conditions without on-site inspections to verify claims.

Using TRAIL playbooks, they can find the critical signals for insurance-ready analysis.

See how TRAIL gives insurers the visibility they've been missing: TRAIL - AI Workers for Construction Insurance

What are TRAIL Playbooks?

Playbooks are standardized workflows inside TRAIL that assess different risk aspects. Each playbook is built on measured, multi-year geospatial evidence delivered through source-backed summaries, risk classes, and maps that directly support underwriting, engineering referral, and claims analysis.

{{services-widget}}

How Playbooks Support Construction Insurance

TRAIL Playbooks strengthen the existing insurance workflows. For construction liability and large infrastructure projects, they provide underwriters, risk engineers, and claims teams with a single, consistent evidence layer they can rely on from first submission to post-event analysis.

Underwriting & Engineering Referral

Playbooks give underwriters and risk engineers a clear, consolidated view of ground stability, grading history, and water-related sensitivities around a proposed project. Instead of scanning scattered documents or relying on isolated boreholes, the team sees:

• mapped stability trends
• areas of subsurface variability
• water-driven accumulation or recharge zones
• portions of the site shaped by past earthworks

This helps sharpen early decisions: when to request more information, when to apply conditions, and when to escalate for engineering review. More importantly, it provides traceable justification for those decisions, grounded in measurable evidence rather than judgment alone.

Claim Auditing & Forensic Engineering

When ground-related disputes arise years after construction, settlement, uplift, drainage failures, or neighbor impact - Playbooks help reconstruct what the site looked like before, during, and after the project.

This includes:

• Pre-existing deformation and water risk
• How earthworks or grading changed the terrain
• Whether movement patterns accelerated post-construction
• Which conditions were foreseeable at bind

The ability to compare pre- and post-event ground behavior gives claims teams a neutral evidence baseline for determining whether the loss stemmed from pre-existing conditions, construction activities, or external factors. It shortens disputes, clarifies responsibility, and supports more defensible outcomes.

Delay in Start-Up Assessment

Using third-party high-resolution satellite imagery and KorrAi’s change analysis, TRAIL enables progress monitoring throughout construction. With auditable evidence of project status, insurers can find answers to questions like:

• Did the site conditions actually delay construction and the commercial operations?
• How much of the total delay is attributable to the insured event versus other factors?
• What was the project status immediately before the event was reported?
• Were there pre-existing reasons for delays that should be excluded from the claim?

Case Study: How KorrAI Helps Zurich’s Construction Liability Underwriting

Context

Zurich E&S provides a tangible example of how remote ground intelligence is already reshaping underwriting. Within Construction Liability, Zurich operationally uses KorrAI’s Ground Motion Risk Index (GMRI) as part of its risk-enrichment workflow. While subsidence is excluded under Property as part of Earth movement, it remains a significant third-party liability exposure for contractors, design-build firms, and engineers.

This is where pre-bind visibility has been thin for a long time.

Solution

To address this gap, Zurich integrates GMRI directly into its Statement of Values (SOV) enrichment pipeline. GMRI is appended for eight high-risk states where ground movement has been shown to materially influence liability outcomes.

This expanded evidence stack feeds into Zurich’s Casualty Risk Quality Score, which informs escalation pathways. GMRI effectively becomes a structural part of the decision process: a way to quickly identify sites with elevated ground instability and to ensure that referrals and conditions are grounded in measurable risk rather than anecdotal interpretation.

Impact

GMRI inside Zurich’s workflow has served as consistent evidence for construction liability underwriting. Zurich’s deployment validates GMRI as insurer-grade, operational, and scalable.

With TRAIL Playbooks, Insurers can move from a single powerful signal to a fully structured evidence layer to provide consistent, documented, and defensible underwriting.

Final Thoughts

Subsurface risk has always been present; what’s been missing is a reliable way to see it early, accurately, and at the scale insurance demands. GMRI proved that multi-year ground evidence can meaningfully strengthen construction liability decisions. TRAIL and its Playbooks build on that foundation, bringing document intelligence, site evolution, groundwater behavior, and hazard context into one traceable workflow.

For insurers navigating rapid construction growth and rising ground-related losses, this represents a practical way forward: clearer visibility, more consistent decisions, and better control of long-tail exposure.

If you’d like to explore how TRAIL can support your underwriting and risk engineering programs, you can submit an expression of interest for TRAIL or book a meeting with our experts to learn more.