Tech E&O insurance can cover claims that your AI product caused a customer financial loss. Coverage depends on the work your policy insures, its exclusions and any endorsements you buy. Having “Tech E&O” on a quote doesn’t settle the question.
At Corgi, AI-related claims are excluded from our standard Tech E&O policy. AI coverage is available through our optional AI and Algorithmic Liability endorsement, with the relevant modules selected for your business.
This matters when a customer sends over insurance requirements. You need coverage that fits what your product actually does. An assistant that drafts emails creates different risks from an agent that can change a customer’s production system.
Why the AI wording matters
Technology errors and omissions insurance addresses certain customer financial-loss claims arising from mistakes or failures in your technology products or services.
How a policy treats AI varies. Some insurers include explicit AI language; others offer endorsements that change the policy’s terms. Exclusions can narrow the protection. In June 2026, for example, CFC announced explicit AI wording across Tech E&O and other products.
The useful question is: “Where does this policy cover what our AI does, and what is still excluded?” Get the explanation alongside the proposed wording.
What does Tech E&O cover for an AI startup?
These hypothetical examples show the distinctions worth checking.
Does Tech E&O cover AI hallucinations?
It can cover a customer’s financial-loss claim arising from an AI hallucination when the insured activities and AI wording cover that exposure.
Say your inventory tool invents a figure in its forecast. A customer relies on it, over-orders stock and brings a claim against your company for the loss.
Check that the policy includes your AI product and that an AI exclusion doesn’t remove the relevant protection. The fact that no one hacked the system doesn’t rule out a Tech E&O claim.
Does it cover AI copyright claims?
It may, depending on the intellectual property, Media Liability and AI provisions. “IP coverage” alone doesn’t explain which claims are included.
Imagine a customer publishes an image made with your app. A photographer alleges that the image infringes their copyright and makes a claim against your company.
Check how the policy treats generated outputs and training-data allegations. Also distinguish copyright from patent and trade-secret claims; protection for one doesn’t establish protection for the others.
What if an AI agent causes an outage?
A customer’s claim that your agent caused them financial loss raises a Tech E&O question. Restoring your own systems or responding to a privacy breach involves different coverage questions.
For example, your agent changes a customer’s system settings and takes their service offline. Review how the policy treats that autonomous action and the resulting claim against your business.
CFC’s AI scenarios illustrate how AI incidents can involve different insurance sections. Our Tech E&O vs. Cyber guide explains the broader distinction between customer claims and cyber-related losses.
Five things to check in your AI insurance quote
1. Does the description match your product?
Explain what your software does, who uses it and what decisions or actions it can make. Include the models and APIs you depend on, whether you fine-tune models, and where a person reviews the output.
If you use another company’s model, review its indemnity separately from your insurance. You still need to understand how your policy treats a claim against your business involving that model.
Aon’s AI underwriting checklist recommends mapping AI uses, oversight, vendor relationships and potential failures. Concrete examples give an underwriter more to work with than “we build AI software.”
2. Which AI protection are you buying?
Read the endorsements listed in the proposal alongside the exclusions. Check which activities they address, such as inaccurate outputs, discrimination allegations, training-data disputes or autonomous actions.
The proposal should make clear what is included, what costs extra and what remains excluded. If your product could cause physical injury or damage, raise that explicitly, too.
3. How much is available for a claim?
Check these amounts separately:
- Per-claim limit: the most available for one covered claim.
- Aggregate limit: the total available across covered claims during the policy period.
- Any AI sublimit: a smaller limit for a particular AI exposure.
- Retention: the amount your business must pay toward a covered claim.
Also check whether defense costs reduce the limit. The Hartford’s Tech E&O renewal information, for example, states that they do under that policy.
A hypothetical quote might show a $1 million overall limit but a $100,000 AI sublimit. For a claim subject to that sublimit, the smaller number matters.
4. What about promises in your customer contract?
A customer’s damages claim, a refund and an SLA credit can be treated differently. Bring the insurance clause, performance guarantees and indemnities you’ve agreed to.
For example, Corgi’s SLA carveback endorsement can extend protection for certain contractual failures arising from covered wrongful acts. SLA penalties, liquidated damages, service credits and refunds remain excluded.
Check the gap between what your contract promises and what the proposed policy covers before you buy.
5. Which dates and reporting rules apply?
For claims-made coverage, check when a claim must first be made against you and when it must be reported. The retroactive date can restrict coverage for earlier work.
If you’re replacing a policy, review continuity before canceling it. Our switching guide explains prior acts, reporting and coverage gaps.
Why choose Corgi for AI coverage?
We think Corgi is a strong choice for AI founders who want specific coverage options and help meeting customer insurance requirements.
Our AI and Algorithmic Liability endorsement, CORG-TECH-0038, offers selectable modules for risks including:
- Hallucination and defamation claims involving AI outputs.
- Algorithmic bias and discrimination.
- Training-data misuse and AI intellectual property.
- Data poisoning and adversarial attacks.
- Autonomous-AI bodily injury.
Each selected module has its own limit and retention. Availability depends on underwriting and jurisdiction. Our published product summary explains the options; your issued policy sets the terms.
That gives us a practical starting point: what your product does, what a customer could lose and which protection you’re buying.
We can also help with the requirements behind the purchase. When Eragon needed insurance for a major enterprise customer, Corgi handled the required policies, limits and certificates. Founder and CEO Josh Sirota says we helped close the contract in days.
Bring us a short product description, your current policy if you have one, and the requirements your customer sent over. We’ll help you work through the coverage options and paperwork so you can keep the deal moving.
Get a Corgi quote, or talk through your AI coverage with our team.
Product information and sources checked October 23, 2026.
