Since ChatGPT’s launch in November 2022, AI has been gaining a lot more attention from the media, popping up on friendly talking circles and, of course, in the insurance community. AI is now a perpetual feature of our life, offering greater efficiency, automation and autonomy for businesses and their clients. Insureds are also increasingly raising questions about insurance coverage and possible future restrictions, and underwriters are concerned about potential new exposures. So, seeing the numerous questions and concerns from clients and underwriters, Joanne Cracknell and Roberto Felipe joined forces to propose a few thoughts on how AI is impacting the Professional Liability universe.
Although it is a growing underwriting concern at the moment, it is recognised that AI may reduce risk for insureds and insurers alike, particularly as AI can take many forms and can include machine-based learning, deep learning, narrow AI, and artificial general intelligence. The speed that AI can process vast amounts of data to identify potential problems and anomalies cannot be done by any human, which enables predictive analysis and fast (non-human) decision making leading to positive results. If the use of AI is based on a robust corporate policy by the insured, it should offer extra comfort to underwriters in terms of risk prevention and management.
Nevertheless, it is crucial to initiate a dialogue and inform underwriters about AI's usage in rendering professional services. AI's integration extends to various industries, including Construction, where it enhances efficiency and quality across various stages. From Pre-Design with feasibility studies to validating building code compliance during Permitting and Approvals, or even optimising Project Management, AI streamlines tasks, making them more efficient and cost-effective.
Hence, regardless of the underlying business using AI, discussing how AI is employed, including the insured's policy, protocols, and controls, with underwriters is imperative. This not only raises awareness of potential exposure but also highlights risk mitigation through disciplined and effective technology utilisation.
Therefore, the conversation on how the AI is being used (including full insured’s policy on the matter, protocols, and controls) is necessary to be held with underwriters, so they are not only aware of potential exposure, but can also appreciate how risk is being mitigated with a disciplined and effective use of this technology.
Underwriters concerns in AI usage are centred on professionals recklessly using chatbots which can result in inaccurate advice and wrongful professional acts. An illustrative example emerged earlier this year, involving a US lawyer[1] who sought to establish legal precedent using ChatGPT without adhering to established protocols.
Similar situations could arise if accountants exclusively rely on chatbots for tax solutions or engineers employ AI for project specifications, bypassing corporate/market-tested and approved tools.
Roberto has over 15 years’ experience in the Professional Liability insurance market in Latin America, Continental Europe and in the UK. Roberto has a long trajectory as a Construction Professional Indemnity underwriter, serving as Regional and Global Practice Leader for a renowned insurance company. Roberto joined WTW as a Client Management Director on the Construction Professional Indemnity team in London. The team is exclusively focused on Design Consultants, Design Build Contractors and Project Owners with a bias towards large and complex Professional Indemnity insurance placements for global contractors and consultants.
