AI Risk and Cyber Insurance: Assessing Risk and Coverage Portfolios; Improving Audit and Incident Response Efforts

This CLE webinar will explore the emerging cybersecurity and data privacy risks arising from AI use and how cyber liability insurance coverage is adapting to address them, through both coverage exclusions and new product offerings. The panel will highlight important case law developments addressing AI losses, as well as how data privacy and cybersecurity practitioners can help business clients adjust data privacy and cybersecurity audit efforts to include AI-related risks. 

Organizations of all sizes face cybersecurity and data privacy risks that traditional insurance policies may not fully cover, and cyber insurance helps mitigate those exposures and costs. Coverage can include forensics, litigation expenses, ransomware payments, customer credit monitoring, investigative responses, fines, and more. At the same time, the rapid adoption of generative artificial intelligence (GenAI) and advanced machine learning in core business operations has introduced distinct risks, including algorithmic bias, unpredictable outcomes, hallucinations, and "black box" errors, all of which can create uninsured cyber exposure if not addressed in a company's policy.

Businesses must understand how they use AI in daily operations and which products or outcomes depend on it to evaluate heightened cybersecurity risks and available coverage. First-party cyber coverage may address direct financial losses from AI-related events such as data recovery and business interruption costs. Third-party coverage for external claims, including those by affected customers, may also help offset AI-related exposure. Policy review can reveal AI coverage gaps and help businesses adjust their portfolios as needed, and is especially important as exclusions tighten and AI-related coverage case law evolves.

To meet these challenges, the insurance industry is developing more sophisticated products tailored to AI-related cyber liability, some of which may offer broader protection. However, whether those products provide meaningful coverage at a reasonable cost remains a business-specific question for clients, brokers, and their cybersecurity and data privacy counsel. During this webcast, our faculty will survey emerging AI cyber and privacy threats, discuss best practices for mitigating AI-related risks through audits and incident response planning, and explain how counsel can assess AI risks against existing coverage portfolios and evolving exclusions and case law.

Listen as our authoritative panel provides a practical overview of the latest trends and developments in cyber liability insurance and offers guidance on assisting clients in selecting the right coverage for the new AI risks developing within their business operations.