Vouch, a US-based provider of business insurance, has unveiled AI Insurance, a novel insurance product that helps artificial intelligence (AI) startups survive lawsuits and innovate faster.
According to the firm, AI Insurance offers coverage for financial losses from AI products or services, which includes top-of-mind risks like large language model (LLM) hallucinations, algorithmic bias, regulatory investigations, and claims of IP infringement in systems that utilize AI algorithms.
Vouch also explained that the product can also pay for defense costs and damages, irrespective of fault.
The US-based firm also noted that it will handle the claims so startups can conserve capital and maintain momentum.
The product includes affirmative coverage for:
- AI Errors & Omissions: Covers error and omission claims caused by AI products or services.
- Bias and Discrimination: Addresses claims related to algorithmic bias or discrimination.
- IP Claims: Safeguards against allegations of IP law violations.
- Regulatory Investigations: Provides defense cost coverage for AI-specific regulations.
In addition, Vouch noted that the launch of AI Insurance solidifies the company’s commitment to fueling the startup economy through innovative insurance solutions.
Sophie McNaught, Director of AI at Vouch, commented: “When you’re a typical SaaS company, missing a quarter of progress to a lawsuit is a setback. For AI companies, it’s existential. Vouch’s AI Insurance is a critical financial backstop that helps AI startups innovate boldly and survive challenges.”
John Wallace, Chief Insurance Officer at Vouch, said: “In just half a year, we’ve seen a surge in AI startups – going from 10% to 70% of the new companies we work with. The launch of AI Insurance shows how quick we are to spot and respond to new risks and potential coverage deficiencies in emerging industries. We knew the AI industry couldn’t afford to wait the years it typically takes insurance to catch-up.”
Kate Wagner, Head of Operations at Roboflow, a client of Vouch, shared their experience: “Finding an insurance partner like Vouch, who not only understands our business but also keeps pace with the complex legal landscape surrounding AI, has been invaluable. Their expertise gives us the confidence to focus on innovation, with greater assurance that we can handle challenges along the way.”
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.