Hiscox UK has revised its technology insurance product to include affirmative cover for claims related to artificial intelligence (AI).
The updated policy applies to a range of scenarios, including businesses using AI in day-to-day operations, building AI models for clients, or advising on AI tools. Hiscox is among the first UK insurers to offer this type of cover through a specific and detailed clause.
Adam Atkins (pictured), head of technology at Hiscox UK, acknowledged that while AI is a considerable opportunity, it also carries additional risks. This is why it is important for the insurance industry to be proactive and clear with customers about whether these risks are covered, Atkins said.
“This need for clarity is compounded by the UK government’s ambition to accelerate AI adoption,” he added. “As more AI businesses emerge and companies increasingly integrate these tools, the demand for clear and comprehensive cover will only grow.”
The updated wording provides explicit protection for AI exposures within its professional indemnity policy.
The policy is now designed to cover a variety of scenarios, including when a customer uses AI to complete a contract and it goes wrong, relies on AI output to deliver on a contract and it fails, inputs incorrect information into an AI tool and uses the output to complete a contract leading to errors, builds an AI model for a client that does not meet the agreed specification, or provides advice on the use of a specific AI tool that is later found to be negligent.
Across the UK insurance sector, AI is being adopted to support internal operations, fraud detection, underwriting, claims processing, and customer engagement. As insurers and technology firms expand their use of AI, questions around transparency, risk, and regulatory oversight have become more prominent, prompting insurers to assess how their policies respond to AI-related exposures.
In response to customer feedback, Hiscox is also introducing four new clauses that address common loss scenarios. These include cover for claims arising from cyberattacks that affect client systems, digital disruptions that impact customers, lost or destroyed customer data, and failures in technology that lead to injury or property damage.
Other updates to the policy include expanded coverage for technology designed to: reduce environmental harm, promote sustainability or conserve natural resources, including pollution-related issues which were previously excluded. The policy also allows automatic indemnification of US customers without requiring changes and extends cover to claims resulting from work carried out by overseas suppliers.
Hiscox said it continues to offer pre-claims assistance and additional provisions now allow for payment of reasonable costs to address potential claim issues, including reimbursement of withheld fees if this helps avoid a claim. All UK acquisitions made during the policy period are now automatically covered, regardless of size. Exclusions for insufficient resources, pollution, and losses linked to the Log4j vulnerability have been removed.
