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Jun 6, 2025

Best AI Insurance Policies for Mid-Size Tech Companies

Compare top AI insurance policies for mid-size tech firms: cyber, E&O, IP, and AI-specific risks. Find the right fit for your AI-driven business.

Best AI Insurance Policies for Mid-Size Tech Companies

Selecting the right AI insurance policy for a mid-size tech company involves evaluating coverage for unique risks such as cyber threats, AI model failures, intellectual property (IP) disputes, regulatory compliance, and operational liabilities. Below is a comparison of leading insurance providers and policy types, focusing on their relevance and strengths for tech companies leveraging AI.

Key Types of AI Insurance Coverage

  • Cyber Liability Insurance: Covers data breaches, ransomware, and digital threats related to AI systems.
  • Technology Errors & Omissions (Tech E&O): Protects against claims of negligence, errors, or failures in AI-driven services.
  • Directors & Officers (D&O) Insurance: Shields company leadership from lawsuits related to management decisions, especially in a fast-evolving regulatory environment.
  • Intellectual Property (IP) Infringement Insurance: Covers legal costs for IP disputes, both defensive and offensive.
  • Product Liability Insurance: Applies if AI-powered products cause harm or fail to perform as promised.
  • AI-Specific Liability and First-Party Coverage: Addresses regulatory liability, discrimination, deep-fake digital crime, business interruption from AI failure, and reputational harm.

Leading AI Insurance Providers and Products

Providers chart by Maria Ignatova

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Notable Policy Innovations

  • AI-Specific Endorsements: AXA XL now offers add-ons that address risks unique to AI, such as data poisoning, regulatory breaches, and IP issues.
  • Affirmative AI Coverage: Munich Re and Armilla provide policies that specifically activate when an AI system fails or does not perform as intended, filling gaps left by traditional insurance.
  • Integrated Risk Management: Providers like Corvus use real-time data and AI to help clients actively manage and reduce risk, not just insure against it.

What to Consider When Choosing a Policy

  • Nature of AI Use: Are you developing AI models, integrating third-party AI, or selling AI-powered products? Coverage needs will vary.
  • Regulatory Exposure: If operating in regions with strict AI regulations (e.g., EU), ensure policies cover compliance failures and regulatory fines.
  • Data Sensitivity: Companies handling large or sensitive datasets should prioritize robust cyber and Tech E&O coverage.
  • Board and Investor Requirements: D&O insurance is often required for companies with outside investors or a formal board.

Summary Table: Policy Focus Areas

Policy Summary by Maria Ignatova

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Conclusion

For a mid-size tech company, the best approach is often a combination of:

  • Cyber Liability and Tech E&O from providers like Corvus for broad digital and operational risk.
  • AI-specific endorsements from AXA XL for emerging generative AI risks.
  • Affirmative AI model failure coverage from Munich Re or Armilla if your business critically depends on AI outputs.
  • Supplemental D&O and IP insurance as needed for comprehensive protection.

Work with a broker familiar with tech and AI risks to tailor a package that fits your company’s specific use of AI and business model.

References:

Maria Ignatova
Maria Ignatova
Web Developer

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