French insurer AXA is taking a more selective stance on financing artificial intelligence (AI) infrastructure and private credit exposures, as it reassesses emerging risks in rapidly expanding but still untested segments.
As per Bloomberg, AXA group chief investment officer Jean-Baptiste Tricot said the insurer still sees AI as a structural trend but is wary of speculative bets in the build-out. “We are convinced of the medium-term trend, but we want to avoid financing technological gambles,” he said in an interview.
Tricot noted that AI-related infrastructure has drawn “astronomical volumes allocated in recent months.” Data centres, which provide the computing backbone for AI models, have become a focal point as investors commit hundreds of billions of dollars to projects tied to technologies that are yet to prove their long-term viability.
Norway’s US$2.1 trillion wealth fund said this week that data centres will not form a major part of its investment strategy over the next three years. The shift comes as some large investors question how far they should back specialised assets that depend on fast-evolving technology stacks and uncertain long-term demand.
Read more: Insurance industry faces new AI cyber threat
Recent analysis from cyber risk specialists has also highlighted emerging vulnerabilities from new AI tooling, including Model Context Protocol (MCP) technology, which allows AI agents to tap multiple data sources and systems and has been described as creating an “uncharted era of cyber risk” for insurers.
The concern is that a single flaw in how these tools are configured or governed could propagate through interconnected environments, complicating risk selection and increasing the scope for systemic losses across portfolios.
“We are trying to avoid overly specialised data centres and data centres that are dedicated or customised for a single player or a single technology, because we don’t know yet which actor or technology will ultimately win the AI race,” Tricot said. AXA is “more interested in financing data centres that have inference and general-purpose capabilities,” he said.
The collapse of US auto parts supplier First Brands earlier this year has also sharpened debate over risk in the US$1.7 trillion private credit market and the potential transmission of losses to lenders and insurers. AXA, one of the world’s largest insurers, has around 65 billion euros deployed in private and structured credit.
“When this type of event occurs or other kinds of hit in the private credit sphere, we review our entire book one by one, line by line, to ensure that we have nothing similar,” Tricot said, adding that AXA’s guidelines would not have allowed material exposure to First Brands or Tricolor.
He said the insurer prioritises documentation quality and relatively short maturities, and has accelerated portfolio reviews in recent months.
AXA’s private and structured credit allocation represents around 14% of total deployment, with more than half in senior tranches of collateralised loan obligations or mortgages in European markets such as the Netherlands, Switzerland and Germany, according to Tricot. About 84% of the private credit portfolio is investment grade, and the firm works with around twenty European and US asset managers.
“Our philosophy in general in private and structured credit is not to buy all of an asset manager’s production, we tend to go instead for single managed accounts or funds of one structure with strict investment guidelines,” he said. “What we will continue to avoid in private credit are technological bets and exposure to subprime consumers.”
