Insurance Law » Insurance For AI-Related Risk

Insurance For AI-Related Risk


June 1, 2023

Businesses are already using generative AI tools and those that do have to consider the risks involved. Covington attorneys, writing in Bloomberg Law, point out AI’s tendency to provide plausible-sounding incorrect answers and note a Goldman Sachs warning that skilled employees who lose jobs to AI may try to sabotage the technology or the business. Many commercial insurance policies might respond to losses from business use of generative AI, but policyholders should look for potential gaps, and carefully scrutinize policy language written for old-fashioned risks that might be ambiguous with respect to AI. Cyber policies are a good place to look for potential coverage, but insurers can be expected to exploit exclusions and uncertain wording. Property policies are a good source of business interruption coverage if a qualifying AI-related event disrupts operations. Technology errors and omissions policies might pay claims for AI-generated erroneous advice.

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