Insurers Exclude AI from Policies, While Startups Offer Coverage for AI Agents
Major insurance companies are adding AI exclusions, while new players offer specialized liability coverage for AI agents. Experts warn of discrepancies between advertising and policy terms.
On October 30, 2026, ZDNET published a piece on how insurers are responding to risks associated with AI agents (autonomous programs that perform tasks without constant human oversight). Major companies, including AIG, Great American, and WR Berkley, are working with U.S. regulators to add AI exclusions to their policies. According to the source, insurance commissioners in several states, particularly Florida, Connecticut, and Maryland, have already agreed to these requests.
This differs from previous practice, when insurers covered general software-related risks. Now, however, complex multi-agent systems gain access to email, credentials, customer records, and payment systems. AI collaboration tools run on employees' devices. IT departments struggle to track all AI vendors, each with different data-sharing policies that affect compliance. Such unpredictability does not fit every insurer's risk appetite.
In practice, businesses will have to scrutinize policy terms carefully. Small startups and specialized insurers are moving in the opposite direction. For example, the Y Combinator-backed startup Klaimee raised $5.5 million in seed funding in July to audit autonomous AI agents and provide them with specialized liability coverage. HSB, a Connecticut-based subsidiary of Munich Re, has been selling AI liability insurance for small and medium-sized businesses since March. However, according to ZDNET, there are alarming discrepancies between what providers advertise and what their policies actually cover. Milad Morgan, founder of the insurance broker Atlas Risk Partners, noted that businesses often miss the nuances: "AI insurance" may offer various triggers that are not interchangeable. He advises requesting exact wording and working through a specific loss scenario.
It remains unknown exactly which triggers are offered in each specific policy and how broadly the new insurers will cover losses. There is also no data on how AI exclusions will affect existing policies and which states will follow the example of Florida, Connecticut, and Maryland.