GENERATIVE AI ERRORS & OMISSIONS INSURANCE
When your AI is confidently wrong — a fabricated figure, an invented fact, a bad answer — and a customer relies on it, the loss lands on your company. This is affirmative coverage for inaccurate, incomplete, and fabricated AI output.
CONFIDENT OUTPUT IS NOT THE SAME AS CORRECT OUTPUT
THE PROBLEM WITH A MACHINE THAT IS NEVER UNSURE
A generative model does not say "I don't know." It produces a fluent, confident answer every time — even when that answer is wrong. The industry calls it a hallucination, or confabulation. To your customer, it just looks like your company gave them bad information.
A Generative AI Error claim arises when your system produces output that is inaccurate, incomplete, or entirely fabricated, a third party relies on it, and that reliance causes a financial loss. The output looked authoritative. That is exactly what makes it dangerous.
It does not matter whether the error came from a chatbot answering a customer, a model drafting a client deliverable, or AI-generated code shipped into production. If the work went out under your name and someone was harmed by the mistake, the exposure is yours — and this is the coverage built to respond to it.
> ai_assistant: Yes — you can submit your request for up to 90 days after travel and still receive the discount.
Policy actually requires approval before travel. The answer was fluent, instant, and wrong — and a customer relied on it.
AI ERRORS ARE ALREADY PRODUCING REAL LIABILITY
Two of the most-cited AI cases to date are both, at their core, errors-and-omissions stories: a system gave confident, wrong information, and a court held the humans behind it responsible.
THE CHATBOT THAT INVENTED A POLICY
An airline's support chatbot told a grieving passenger he could claim a bereavement fare after his trip. The published policy said the opposite. The tribunal found negligent misrepresentation and held the airline liable — flatly rejecting the argument that the chatbot was somehow a separate party responsible for its own words.
THE CITATIONS THAT NEVER EXISTED
Attorneys submitted a court brief built on case citations a generative model had fabricated. The authorities were not real. The court imposed sanctions — a now-standard cautionary tale about putting unverified AI output into work product that others rely on.
HOW A SINGLE WRONG ANSWER BECOMES A CLAIM
An AI error rarely looks like a disaster at the moment it happens. Walk the five steps from a fluent mistake to a liability claim — and see where affirmative coverage steps in.
THE FORMS WERE NOT WRITTEN FOR THIS
Professional liability was built around human professional negligence. A confident machine fabrication sits in a gap many forms never anticipated — and the market has started closing that gap by excluding AI, not covering it.
STANDARD-FORM EXCLUSIONS
Effective January 1, 2026, new ISO general liability endorsements let carriers carve generative AI out of standard commercial policies entirely — text, images, audio, video, and code.
E&O IS NOT IMMUNE
Some carriers have moved to exclude AI-related claims from professional liability as well. Whether your specific E&O still answers "yes" depends on the carrier, the wording, and your renewal date.
BUILT TO RESPOND ON PURPOSE
A standalone Generative AI Error policy is written to cover this exposure affirmatively — defense costs and damages from a reliance-based AI mistake — rather than leaving it to silent or excluded language.
FOUR THINGS BUSINESSES ASSUME ABOUT AI ERRORS
Each card is a common assumption we hear. Tap to turn it over.
"Our E&O already covers anything our staff produces."
Most E&O forms predate generative AI, and some carriers now exclude AI claims outright. Coverage for an AI error is increasingly something you confirm, not assume.
"If the AI got it wrong, that's the vendor's problem."
Courts have placed responsibility on the business that deployed the tool, not the model's maker. The output went out under your name, so the claim comes to you.
"Someone skims the output, so we're covered."
A quick glance does not catch a fluent fabrication, and it does not create coverage. Human review lowers frequency and helps underwriting — it does not replace the policy.
"This only matters for actual AI companies."
Any established business that lets AI touch customer-facing work carries the error exposure — marketing, support, advisory, software, operations. You do not have to build AI to be liable for it.
WHERE AI ERRORS ACTUALLY HIDE
Start by asking where AI output reaches a customer. Most error exposure is sitting in routine, everyday workflows your team may not even flag as "AI."
CUSTOMER-FACING ANSWERS
Support chatbots and AI assistants that quote prices, policies, eligibility, or specifications directly to customers in real time.
CLIENT DELIVERABLES
Reports, analyses, designs, and recommendations drafted with AI and delivered as your firm's professional work product.
AI-GENERATED CODE
Code written or completed by AI and shipped into the products and systems your customers depend on.
RESEARCH & SUMMARIES
AI-summarized facts, figures, and citations that feed decisions — where an invented detail can travel a long way before anyone checks.
QUOTES & CALCULATIONS
AI-assisted pricing, estimates, and calculations that customers act on, where a wrong number becomes a wrong commitment.
AUTONOMOUS WORKFLOWS
Agentic tools that generate and act on output with no human approving each step — the highest-severity version of this exposure.
⚠ AGENTIC = INSTANT YESBUILT FOR ESTABLISHED, AI-RELIANT BUSINESSES
This affirmative market is designed for companies at scale, where AI-assisted work already reaches customers and a single error can carry real financial weight.
PART OF THE GENERATIVE AI INSURANCE STACK
Errors & omissions is one trigger. Explore how it connects to the rest of the cluster.
GEN AI ERRORS & OMISSIONS QUESTIONS
WHAT EXACTLY IS A "GENERATIVE AI ERROR" CLAIM?
ISN'T THIS THE SAME AS MY TECH E&O POLICY?
DOES A HUMAN REVIEWING THE OUTPUT REMOVE THE RISK?
WE ONLY USE AI INTERNALLY. ARE WE STILL EXPOSED?
IS THERE A MINIMUM COMPANY SIZE FOR THIS COVERAGE?
HOW DO I GET A QUOTE FROM KELLY INSURANCE GROUP?
FIND RELATED COVERAGE FAST
LOADING LIVE SITEMAP...