RAND wants better data to price machine-made mishaps, apocalypse not included.
Companies want to protect themselves from the financial liability of deploying unreliable, mendacious, amoral AI agents, but insurance companies have become wary about taking on that risk.
RAND says its report was motivated by the mismatch between rapid enterprise adoption of AI and the fragmented market for insuring or not insuring AI usage, in the US. Apocalyptic scenarios aside, the report says that companies are already grappling with AI-related incidents and related litigation while insurers, regulators, brokers, and policyholders puzzle over risks, coverage, and rules.
Insurer W. R. Berkley has already introduced exclusions in its D&O (directors and officers), E&O (errors and omissions), and Fiduciary Liability insurance products to exclude coverage for "any actual or alleged use, deployment, or development of Artificial Intelligence."
The RAND report observes that some insurance carriers are excluding AI-related harms, noting that in January 2026, Verisk/ISO – whose standardized forms appear in more than 80 percent of US property and casualty policies – introduced optional language carriers can adopt to exclude bodily injury, property damage, and other harms arising from generative AI.
Not all insurers are deciding not to cover AI harms. As RAND points out, coverage gaps are being filled by new and existing companies that believe they have a handle on the risk calculations.
To illustrate those risks, the report points to the Artificial Intelligence Incident Database which lists tral-world harm or near-harm caused by generative AI. The AIIDB lists 713 incidents drawn from more than 6,000 reports and covers AI use beyond chatbots.