THE DECODER

Several large insurers, including AIG, Great American, and WR Berkley, have filed requests with U.S. regulators to exclude AI-related risks from their corporate insurance policies, according to the Financial Times. The companies warn that generative AI systems like chatbots and AI agents could expose them to billions of dollars in liability claims.

WR Berkley reportedly proposed an exclusion that would apply to any claim resulting from the use of AI in any form. AIG told Illinois insurance regulators that generative AI represents a broad and far-reaching technology and that related claims are likely to increase in the future.

Insurers point to recent lawsuits as evidence of the problem. Wolf River Electric sued Google for at least $110 million, alleging that the company’s AI-generated overview spread false statements. In another case, a court ordered Air Canada to honor a discount price its customer service chatbot had invented.

Kevin Kalinich, a managing director at Aon, said the insurance industry could handle a single $400 million loss but not 1,000 or 10,000 correlated claims caused by an error from one AI provider.