AI tools are now part of how most New Zealand businesses operate. But most business insurance policies haven’t kept up and that’s a problem worth knowing about.
The risks AI introduces that your policy may not cover
Cyber liability. AI tools run on data, and a lot of that data belongs to your customers. If it’s exposed in a breach, you could be liable. Cyber liability insurance for NZ businesses has never been more important than it is right now.
Professional indemnity. If your business uses AI to generate advice, recommendations or reports and a client suffers a loss because of an error the responsibility often sits with you, not the software. Professional indemnity cover needs to reflect how you actually work today.
Intellectual property. AI generated content can unintentionally reproduce copyrighted material. If your business publishes that content, an IP claim could follow. It’s an emerging risk that’s already playing out in overseas courts.
What to do about it
Talk to your broker. Not to tick a box, but to actually go through what tools you’re using and whether your cover reflects that. Most policies were written before AI was mainstream which means there’s a good chance yours has gaps you’re not aware of.
If you’re a NZ business using AI tools and you’re not sure where you stand with your insurance, we’re happy to have that conversation. It usually doesn’t take long.
Sentinel Insurance is a specialist business insurance broker based in New Zealand. We help businesses get the right cover for how they actually operate.
