AI Agent Insurance Products: The New Wave, and How to Launch One | Openkoda
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AI Insurance<br>AI Agent Insurance Products: The New Wave, and How to Launch One
Insurers spent 2025 and 2026 writing AI out of standard policies and building a new market to replace it. Here is what Armilla, Munich Re, AIUC, Klaimee, HSB and Testudo actually sell, and what it takes to launch a product like theirs.
By Michał Głomba<br>Guide · 12 min read · Updated 2026
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In February 2024 a British Columbia tribunal ordered Air Canada to pay a passenger CA$812. The airline’s website chatbot had told Jake Moffatt he could book a flight and claim a bereavement discount retroactively. He couldn’t. Air Canada argued that the chatbot was, in effect, responsible for its own answers. The tribunal did not accept that, and pointed out the obvious: the bot was part of the airline’s website, so the airline owned what it said.
The money was trivial. The principle was not. Moffatt v. Air Canada settled, cheaply and early, the question every business now has to answer at much larger scale: if your AI gets it wrong, you pay.
And that was a chatbot answering a question. The systems being deployed in 2026 do things. They issue refunds, place orders, move money, change records, write and ship code, and make decisions inside workflows where nobody reads every step. The failure modes are bigger, faster and harder to spot. Insurers worked this out well before most of their customers did, and they have responded in two directions at once: writing AI out of the policies businesses already hold, and building a new market to sell back.
Standard policies are being closed to AI on purpose
The clearest signal came from Verisk, whose ISO policy forms sit underneath a very large share of the world’s property and casualty business. Verisk filed a family of generative AI exclusion endorsements that carriers could start attaching to commercial general liability renewals from 1 January 2026:
CG 40 47. Excludes bodily injury, property damage and personal and advertising injury arising out of generative AI, under both Coverage A and Coverage B.
CG 40 48. The narrower version, Coverage B only, aimed at advertising and personal injury claims from AI-generated content.
CG 35 08. Applies the same exclusion to products and completed operations.
They are optional forms. Carriers choose whether to attach them, and plenty have chosen to. Separately, the Financial Times reported that AIG, Great American and WR Berkley were seeking regulatory approval to exclude AI-related liabilities from corporate policies, with units of Berkshire Hathaway, Travelers and Chubb moving in the same direction.
Technology errors and omissions, the line closest to the risk, is not the safety net people assume either. Tech E&O was written for deterministic software and human-delivered services. Where AI is addressed at all, it is often addressed by sublimit. Armilla has pointed to general technology policies that carry a $25,000 sublimit for AI-related liabilities inside cover that otherwise runs to $5m.
Even the model developers feel it. OpenAI has reportedly arranged roughly $300m of cover for emerging AI risks through the broker Aon, against litigation claiming multiples of that figure. When insurers will not comfortably cover the companies building the technology, the message to everyone deploying it is not subtle.
The reasoning is straightforward. Insurers price from loss history, and there isn’t one. The losses that do exist are correlated in an unpleasant way: if a widely used foundation model degrades or gets jailbroken, thousands of policyholders can have a bad day simultaneously. That is a hard risk to model and an easy one to exclude.
Excluding it, though, leaves a gap that businesses very much want filled. Deloitte’s Center for Financial Services expects AI-specific insurance premiums to grow at roughly 80% a year and reach about $4.8bn globally by 2032. Testudo, one of the new specialist underwriters, says generative AI litigation is up 137% year over year. The exclusions and the new products are the same story told from two ends.
Five shapes the new products take
Almost everything on the market today is a variation on one of five designs. They differ in what triggers a payout, how the risk is assessed, and who actually buys the policy.
1. Affirmative AI liability
Armilla is a managing general agent and Lloyd’s coverholder set up specifically for AI risk. Working with Chaucer and other Lloyd’s underwriters, it launched a standalone AI liability policy in spring 2025 that says out loud what standard policies now exclude: hallucinations, model drift, inaccurate outputs, data leakage, and claims tied to defamation, confidentiality breaches and regulatory violations. Limits reach $25m per organisation.
What makes it interesting is the trigger. Rather than waiting purely for a lawsuit,...