HSB Introduces AI Liability Insurance for Small Businesses

• AI insurance protects businesses from AI lawsuits
• Includes bodily injury, property damage, advertising injury coverage
• HSB survey shows 91 percent of companies plan to use AI
• AI liability protection helps add certainty to an AI-driven world

Fills Coverage Gaps and Exclusions

HARTFORD, Conn.--(BUSINESS WIRE)--Specialty insurer HSB today introduced a new artificial intelligence (AI) liability insurance coverage that protects businesses from lawsuits resulting from the use of AI technologies.

Designed for small and medium-sized companies, HSB AI Liability Insurance can pay for AI-related losses that some General Liability policies exclude, including bodily injury, property damage, and advertising injury for claims stemming from AI-generated advertising, marketing, blogs, and social media.

“All types of businesses are using AI to do things more quickly and efficiently,” said Timothy Zeilman, global head of product ownership for HSB, part of Munich Re Group. “At the same time, the AI transformation brings new legal and financial exposures. Business owners may wonder, am I protected? AI insurance helps remove that uncertainty by filling the gaps in coverage, so businesses can stay ahead of emerging risks.”

Small Businesses Embrace AI, but Worry About the Risks

Increasingly, smaller businesses are relying on AI to boost productivity, reduce costs, and stay competitive by automating routine tasks and analyzing data.

Almost three-quarters (74 percent) of small and medium businesses are using AI programs, according to a survey by HSB, and 91 percent plan to in the future.¹

Marketing accounts for most of the AI activity (47 percent), followed by operations (43 percent), research and development (42 percent), and social media (38 percent).

New Insurance Protection for AI Liability Exposures

HSB AI Liability Insurance protects against key exposures for an organization’s use of AI including:

• Liability Due to Bodily Injury for lawsuits alleging a person is injured due to the insured’s use of AI. For example: the coverage may apply if an AI-controlled HVAC system creates condensation on the floor, and a person slips, falls, and is hurt.
• Liability Due to Property Damage for lawsuits claiming that property was damaged due to the insured’s use of AI. One possible situation: an employee of an appliance retailer uses an AI chat bot to generate instructions to install a dishwasher and causes a leak and extensive water damage.
• Personal and Advertising Injury Liability for legal actions claiming the insured’s AI tools violated a person’s right to privacy, slander and libel, or copyright infringement. The unauthorized use of content in a marketing brochure, for instance, or defamatory statements in a blog or social post would be covered.

Pending approval by insurance regulators, the coverage will be added to the business policies of insurance carriers that partner with HSB. HSB does not offer this product directly to businesses.

Visit HSB’s website for more information about HSB AI Liability Insurance.

¹ HSB surveyed 1,000 Main Street category businesses, including real estate, manufacturing, professional services, legal, and financial services. Business sizes include microbusinesses (1-10 employees), small businesses (11-50 employees), and medium businesses (51-500 employees).

Hartford Steam Boiler (HSB)

HSB, part of Munich Re, is a multi-line specialty insurer and provider of inspection, risk management, and IoT technology services. HSB insurance offerings include equipment breakdown, cyber risk, specialty liability, and other coverages. HSB blends its engineering expertise, technology and data to craft inventive insurance and service solutions for existing and emerging risks posed by technological change. Throughout its 159-year history, HSB’s mission has been to help clients prevent loss, advance sustainable use of energy, and build deeper relationships that benefit business, public institutions, and consumers. HSB holds A.M. Best Company’s highest financial rating, A++ (Superior). For more information, visit www.hsb.com and connect on LinkedIn.

Munich Re

Munich Re is one of the world’s leading providers of reinsurance, primary insurance, and insurance-related risk solutions. The Group consists of the reinsurance and ERGO business segments, as well as the asset manager MEAG. Munich Re is globally active and operates in all lines of the insurance business. Since it was founded in 1880, Munich Re has been known for its unrivalled risk-related expertise and its sound financial position. Munich Re leverages its strengths to promote its clients’ business interests and technological progress. Moreover, Munich Re develops covers for new risks such as rocket launches, renewable energies, cyber risks, and artificial intelligence. In the 2025 financial year, Munich Re generated insurance revenue of €60.4bn and a net result of €6.1bn. The Munich Re Group employed about 44,000 people worldwide as of 31 December 2025.

Disclaimer

This news release is intended for information purposes only and does not modify or invalidate any of the provisions, exclusions, terms or conditions of the policy and endorsements. For specific terms and conditions, please refer to the coverage form.