AI Liabilities: Insurers Seek Exclusion
Update: 2025-11-23
Description
Major insurance companies, including AIG and Great American, are seeking regulatory approval to exclude AI-related liabilities from corporate policies due to the unpredictability of AI models. Recent incidents, such as Googles false accusation and Air Canadas chatbot error, highlight the financial consequences of AI mistakes. The potential for AI to be exploited, as seen in the Arup scam, adds to insurers concerns. The systemic risk of thousands of simultaneous claims if a widely used AI model malfunctions is a significant worry for insurers. This situation underscores the complex challenges AI poses to the insurance industry, prompting a reevaluation of risk assessment and management in an AI-driven world.
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