AI is too risky to insure

Insurers like AIG and Great American are seeking to exclude AI-related liabilities from their policies due to the increased risk associated with AI technologies.

Insurers view AI outputs as “too much of a black box,” raising concerns about systemic risks. Past incidents, such as a false accusation by Google’s AI leading to a $110 million lawsuit and a chatbot mistake costing Air Canada, underscore these fears.

As noted by an Aon executive, insurers can manage a large loss to one company, but not thousands of simultaneous claims triggered by an AI mishap.