As AI-powered robots start taking orders at McDonald’s restaurants worldwide, it’s become clear that artificial intelligence isn’t just changing workplaces – it’s becoming ubiquitous. Now, insurers are beginning to take notice.
Three ISO exclusions related to artificial intelligence have gained significant interest from carriers, signaling a growing concern about the risks associated with AI. Insurers are exploring the possibility of excluding AI-related risk in commercial liability policies.
About Those Exclusions
The exclusions in question are designed to specifically address AI-related risks. Insurers are considering excluding risks associated with AI-powered products and services, such as software or robotic systems, from their liability policies. This move would essentially mean that if an insured’s AI-powered product causes damage or harm to others, they might not be covered under their liability policy.
The Reason Behind This Shift
Experts say the increasing penetration of AI into various aspects of life and business is driving insurers to reevaluate their policies. As AI systems become more integrated into daily life, there’s a growing awareness among insurers about the potential risks they pose. This is particularly true for commercial liability policies, which often include coverage for business-related risks. Insurers want to ensure they’re not exposed to unforeseen risks resulting from AI.
What This Means
Insurers excluding AI-related risk from their commercial liability policies could have significant implications for businesses. Companies that rely heavily on AI-powered systems may find it more challenging to obtain liability insurance or may face higher premiums. This could create a financial burden for businesses that are already struggling to adapt to the rapidly changing AI landscape.
As AI becomes increasingly pervasive, it’s likely that insurers will continue to reassess their policies to account for the associated risks. Companies need to be aware of these changes and start exploring alternative insurance options that address the unique challenges posed by AI.
