Corporate insurers are starting to back away from AI risk

Artificial intelligence isn’t just a headache for human resources. More and more, corporate legal teams are becoming entangled in the technology’s mistakes. Generative AI-related lawsuits in the United States grew 978% from 2021 to 2025, according to a report from the reinsurance broker Gallagher Re. But a growing number of insurance companies are removing AI liability coverage. Berkshire Hathaway, Chubb, and Travelers have all won approval to largely drop the protection in recent months. Technically, the companies have added “AI exclusion clauses” to their standard commercial liability policies. Those clauses cover a wide range of issues, including employees alleging AI-driven discrimination, intellectual property violations (such as AI using copyrighted material without a company’s knowledge), and property damage caused by autonomous or robotic systems. It’s a move that could leave many companies exposed to steep financial damages. It could also slow the corporate rollout of AI, as executives weigh whether the potential risks outweigh the technology’s rewards. “This is highlighting a crucial blind spot for businesses,” says Ifeoma Yvonne Ajunwa, a professor at Emory University’s School of Law. “They are clamoring to join the AI bandwagon, but they have to pause and ask if they’re fully protected.” Changes aren’t universal While Berkshire Hathaway, Chubb, and Travelers are major names in insurance, not every insurer is following their lead. HSB , in March, began offering AI liability insurance for small businesses. “All types of businesses are using AI to do things more quickly and efficiently,” said Timothy Zeilman, global head of product ownership for HSB, in a statement. “At the same time, the AI transformation brings new legal and financial exposures. Business owners may wonder, am I protected? AI insurance helps remove that uncertainty.” There are also a number of smaller insurers, some re