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As the tech companies behind generative AI (GenAI) and their corporate clients struggle to figure out how to put guardrails in place, insurance companies sense an opportunity.
Business risks associated with GenAI include everything from cybersecurity issues to copyright infringement, false or biased outputs and the leaking of proprietary company data.
Although it’s still early days, analysts told the Wall Street Journal that there is appetite for AI insurance,and major carriers could offer specialized coverage for financial losses stemming from AI and GenAI. Existing liability or cybersecurity policies could also soon be amended for GenAI.“ I would bet that over fifty percent of large enterprises would buy some of these insurance policies if they come out, and they make sense,” Avivah Litan, a Gartner analyst who focuses on AI trust, risk and security, told the Journal.
Insurance, though, is not a panacea, as corporate clients of cybersecurity insurance are learning. Consumer product manufacturer Clorox has spent $25 million to respond to a recent cyber attack which has negatively impacted its stock price and revenues, according to press reports. More cyber expenses are expected to arise in 2024. The company said it has cyber insurance, but it can't predict which costs will be covered or when, according to an October 4 filing with the Securities and Exchange Commission.
Other ways for companies to manage GenAI risks are also emerging.
Read on to learn more about this story and the week's most important technology news impacting business.

Corporate executives, military personnel, cybersecurity vendors and government officials gathered in Rome October 3 and 4 for Cybertech Europe 2023. This year's topics included the impact of AI on the sector, cyber warfare and geopolitics, Europe’s ongoing battle to protect its critical infrastructure and the advantages of including more women in the sector. The Innovator’s Editor-in-Chief moderated a panel entitled Women4Cyber (pictured here).
Paying subscribers can read on to get the key takeaways from the conference.

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Leveraging data at scale could drive transformative innovation to address climate change, financial crime, public health, and other challenges but it also risks violating the privacy of individuals and communities and can cause competitive risks to organizations. That’s where Tune Insight comes in. The Swiss startup, a spin-out of the Swiss Federal Institute of Technology (EPFL), has developed collaborative analytics and privacy-preserving machine learning software to process raw sensitive data without moving it, enabling companies to collaborate and valorize their data and models, without losing control of their value.

Privacy-preserving data sharing and analytics (PPDSA) methods and technologies that can unlock the beneficial power of data analysis while protecting privacy are seen as being so important that earlier this year the White House announced the establishment of a national strategy to advance them.

Today, most organizations rely on data to make strategic decisions, through statistical analyses or machine learning. Often their own data is not enough but they are hesitant to enter into the data collaborations they need because of security, compliance and strategic risks. For example, the promise of personalized health cannot be realized without processing data from multiple organizations. In cybersecurity, organizations feel the need to collaborate to better defend against cyber threats but cannot share the most valuable data and indicators for strategic reasons. And the insurance and financial services sectors are unable to leverage technology advances to dramatically enhance fraud detection or risk calculation.
Tune Insight aims to enable collaborative data sharing in these sectors by taking an approach similar to federated learning – with a twist, says Tune Insight CEO and co-founder Juan Ramon Troncoso-Pastoriza.

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Number of pieces of space junk - inactive satellites, rockets. missiles, and other things that get left behind - floating in space, presenting a growing challenge to space travel and exploration, according to McKinsey.