Insurance and Underwriting

How insurers cover, price and exclude AI risk.

Dedicated AI coverage is still small: Armilla offers up to $25 million per organization, backed by Lloyd's. Exclusions are spreading faster, and China's PICC launched what it calls the first AI service liability package on October 20, 2026.

AI insurance capacity and losses: Agent loss Aon says the market can absorb $400-500M; Armilla per-organization limit $25M; Arup deepfake loss £20M; Testudo AI liability capacity $9.25M AI INSURANCE CAPACITY AND LOSSES Agent loss Aon says the market can absorb $400-500M Armilla per-organization limit $25M Arup deepfake loss £20M Testudo AI liability capacity $9.25M US DOLLARS, MILLIONS, LOG SCALE
Projected AI premiums by 2032
$4.7B
Rise in generative AI lawsuits, 2025
137%
Executives wanting AI cover
63%
ISO generative AI exclusions
3

Evidence

Specialist cover grew while major carriers filed AI exclusions

Developments: insurance and Underwriting
DateDevelopmentCountryWhat happenedSource
Apr 2025Armilla standalone AI liability coverUnited Kingdom and United StatesLloyd's coverholder productSource
Oct 21, 2025ISO generative AI exclusions announcedUnited StatesThree optional endorsements, January 2026 editionSource
Feb 2, 2026AIG, W. R. Berkley and Great American exclusion filingsUnited StatesBerkley wording covers any actual or alleged use of AISource
Mar 2026Testudo expands capacityUnited KingdomAI liability capacity raised to $9.25 millionSource
Oct 20, 2026PICC AI application risk packageChinaService liability and expense loss cover for models, agents and robotsSource

Rules

Insurers write AI out of standard policies; the EU makes AI a product

Key rules and standards: AI insurance
RuleJurisdictionWhat it requiresStatus
ISO CG 40 47US insuranceExcludes generative AI injury from general liabilityJan 2026 edition
ISO CG 40 48US insuranceExcludes generative AI personal and advertising injuryJan 2026 edition
ISO CG 35 08US insuranceGenerative AI exclusion for products liabilityJan 2026 edition
W. R. Berkley AI exclusionUS insuranceExcludes claims tied to any use of AIFiled; approval not confirmed
Product Liability Directive 2024/2853EUSoftware and AI as products under strict liabilityTranspose by Dec 9, 2026

Status colors: green in force, blue voluntary standard or framework, amber adopted and phasing in, gray draft or pending, red withdrawn.

Record

Page Record

Datasets
ai_compliance_evidence.csv (5 rows)
Key sources
Armilla standalone AI liability cover
ISO generative AI exclusions announced
AIG, W. R. Berkley and Great American exclusion filings
Testudo expands capacity
PICC AI application risk package
Last verified
October 2026