Latest news with #Lockton
Business Mayor
11-05-2025
- Business
- Business Mayor
Insurers launch cover for losses caused by AI chatbot errors
Stay informed with free updates Simply sign up to the Artificial intelligence myFT Digest — delivered directly to your inbox. Insurers at Lloyd's of London have launched a product to cover companies for losses caused by malfunctioning artificial intelligence tools, as the sector aims to profit from concerns about the risk of costly hallucinations and errors by chatbots. The policies developed by Armilla, a start-up backed by Y Combinator, will cover the cost of court claims against a company if it is sued by a customer or another third party who has suffered harm because of an AI tool underperforming. The insurance will be underwritten by several Lloyd's insurers and will cover costs such as damages payouts and legal fees. Companies have rushed to adopt AI to boost efficiency but some tools, including customer service bots, have faced embarrassing and costly mistakes. Such mistakes can occur, for example, because of flaws which cause AI language models to 'hallucinate' or make things up. Virgin Money apologised in January after its AI-powered chatbot reprimanded a customer for using the word 'virgin', while courier group DPD last year disabled part of its customer service bot after it swore at customers and called its owner the 'worst delivery service company in the world'. A tribunal last year ordered Air Canada to honour a discount that its customer service chatbot had made up. Armilla said that the loss from selling the tickets at a lower price would have been covered by its insurance policy if Air Canada's chatbot was found to have performed worse than expected. Karthik Ramakrishnan, Armilla chief executive, said the new product could encourage more companies to adopt AI, since many are currently deterred by fears that tools such as chatbots will break down. Some insurers already include AI-related losses within general technology errors and omissions policies, but these generally include low limits on payouts. A general policy that covers up to $5mn in losses might stipulate a $25,000 sublimit for AI-related liabilities, said Preet Gill, a broker at Lockton, which offers Armilla's products to its clients. AI language models are dynamic, meaning they 'learn' over time. But losses from errors caused by this process of adaptation would not normally be covered by typical technology errors and omissions policies, said Logan Payne, a broker at Lockton. A mistake by an AI tool would not on its own be enough to trigger a payout under Armilla's policy. Instead, the cover would kick in if the insurer judged that the AI had performed below initial expectations. For example, Armilla's insurance could pay out if a chatbot gave clients or employees correct information only 85 per cent of the time, after initially doing so in 95 per cent of cases, the company said. 'We assess the AI model, get comfortable with its probability of degradation, and then compensate if the models degrade,' said Ramakrishnan. Tom Graham, head of partnership at Chaucer, an insurer at Lloyd's that is underwriting the policies sold by Armilla, said his group would not sign policies covering AI systems they judge to be excessively prone to breakdown. 'We will be selective, like any other insurance company,' he said. Read More Tell us: have you been affected by the US insurance crisis?
Yahoo
16-04-2025
- Business
- Yahoo
Lockton appoints new US risk solutions leader
US based insurance brokerage Lockton has appointed Devin Beresheim as its US risk solutions Leader. The role said to consolidate the company's property and casualty (P&C) and professional and executive risk practices. Beresheim, who joined Lockton in 2019 as specialties leader, will report to Tim Ryan, Lockton US president. Beresheim played a key role in reshaping the company's specialty practices, with a focus on collaboration, boosting Lockton's capabilities across areas such as claims, cyber and technology, digital asset risk, financial institutions, private equity and transaction liability. Ryan said: 'I am excited to announce leadership changes that will align our growth strategy with client needs, driving our business forward and enhancing the service we provide. Devin's track record of building connectivity, attracting top-tier talent and expanding our specialty capabilities makes him the ideal leader to drive this integration. His vision will ensure Lockton continues to deliver differentiated value across the full spectrum of risk.' Beresheim added: 'I am honoured to step into this role and build on the strong foundation our teams have created. Bringing these practices together will allow us to streamline operations and offer clients seamless access to the expertise they need to navigate an increasingly complex risk environment.' Earlier this month, Lockton expanded its expertise in cyber risk management through a collaboration with Axio, a company specialising in cyber risk quantification technology. Last month, the company also formed a professional and executive risk practice, merging the US-based Lockton Financial Services and International ProFin teams. The company, which operates with over 12,500 associates in more than 140 countries, attributes its client-focused approach to its private ownership model. "Lockton appoints new US risk solutions leader " was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
10-04-2025
- Business
- Yahoo
Lockton collaborates with Axio on cyber risk analytics
US-based insurance brokerage Lockton has joined forces with Axio, a specialist in cyber risk quantification technology, to enhance its capabilities in understanding and managing cyber risk. Through the integration of Axio's cyber risk analytics, Lockton aims to enable clients to go beyond 'surface-level' risk evaluations and gain more insights on the potential financial impact of a cyber breach. This initiative is expected to deliver data that businesses require for decision-making related to investments, controls and insurance coverage. Axio's analytical process involves a multi-layered approach that includes assessing the general business disruption, followed by industry-specific impacts, and concluding with insights into the client's operational and technical landscape. Furthermore, the tie-up expands to integration of application programming interfaces (APIs) between the Axio360 platform and Lockton's Scout analytics platform. The tech vendor said that this integration will provide Lockton's cyber brokers with real-time analysis. Lockton US cyber & technology leader Michelle Faylo said: "We are thrilled to partner with Axio to enhance our cyber risk management offerings. This partnership enables us to leverage Axio's advanced tools and expertise, equipping our clients with the most innovative risk quantification solutions, so they can confidently navigate an increasingly complex cyber threat landscape.' Axio CEO Scott Kannry stated: 'Together, we are setting a new standard in cyber resilience and helping businesses make informed decisions to protect their assets. Our partnership with Lockton unites our expertise to ensure businesses receive the most comprehensive support when managing their cyber risks.' This development follows Lockton's formation of a new practice, Lockton Professional and Executive Risk. The practice combines the US-based Lockton Financial Services and International ProFin teams. "Lockton collaborates with Axio on cyber risk analytics " was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
01-04-2025
- Business
- Yahoo
Lockton forms Professional and Executive Risk practice
Lockton has created a new practice, Lockton Professional and Executive Risk, by merging its US-based Lockton Financial Services and International ProFin teams. This consolidation unifies more than 750 associates into a single platform, aimed at improving the delivery of client value. The integration is expected to provide clients with 'global connectivity' to manage professional, executive, financial and cyber risks across various operations, the company said. The practice specialises in global insurance broking, risk advisory and claims support for financial and professional insurance lines. The new practice offers insurance solutions such as directors and officers liability, cyber risks, general partnership liability, and errors and omissions/professional indemnity. Additionally, it also comprises employment practices liability, fidelity/crime, fiduciary liability and insurance solutions tailored for digital assets. Lockton EVP and US head of professional and executive risk Devin Beresheim said: "In today's complex and interconnected environment, companies and their boards require a trusted partner that sees their risk holistically. 'Lockton Professional and Executive Risk delivers tailored solutions to help corporate boards and C-suite executives proactively mitigate their most pressing risks on a global level, so they can focus on growing their business.' Lockton UK head of professional and executive risk Leo Flindall stated: 'Through our globally connected team, we can ensure even broader knowledge sharing, deeper risk insights and the ability to anticipate emerging threats with greater response and precision. The launch of this unified team is another milestone for Lockton, reflecting our commitment to continually improving our standard for client service.' In February this year, Lockton launched the BESS Lock facility, targeting the specific needs of battery energy storage system (BESS) projects. The BESS Lock facility aims to streamline coverage options and provide "competitive' pricing with a capacity of up to $315m. "Lockton forms Professional and Executive Risk practice " was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Yahoo
24-03-2025
- Business
- Yahoo
Despite Insurers' Profitable 2024 Results, U.S. Commercial Insurance Market Faces Growing Uncertainty: Lockton Market Update
KANSAS CITY, Mo., March 24, 2025 /PRNewswire/ -- At the start of 2025, the U.S. property and casualty insurance market remains largely stable and predictable. However, growing economic uncertainty, social inflation, and other issues are raising questions about the outlook for the rest of the year, according to the latest edition of the Lockton Market Update. The quarterly report published by Lockton, the world's largest privately held and independent insurance broker, offers timely and relevant insights for commercial insurance buyers. The March report covers U.S. economic conditions, major industry headwinds and tailwinds, and includes a Q&A with an experienced risk professional on the biggest challenges in today's insurance market. "Major industry headwinds such as social inflation, natural catastrophes, climate change, trade wars, tariffs, and regulatory changes are adding to the market uncertainty," said Vince Gaffigan, EVP, Director of Risk Consulting for Lockton. "Now, more than ever, businesses should be reevaluating their insurance programs to safeguard their operations and protect their balance sheets." Conditions remain buyer-friendly across most major lines, including property, workers' compensation, directors and officers liability (D&O), and cyber. A notable exception is third-party liability, which continues to be reshaped by social inflation, driving pricing up and capacity down. "Businesses must adapt to numerous factors impacting the market, including new risks involving trends like AI, cybersecurity, social inflation, and geopolitical crises," said Greg Spore, Lockton's U.S. Financial Services Market Leader. "These conditions make the information and advice in our report even more crucial as business leaders navigate an evolving landscape." Explore the March 2025 Lockton Market Update now for more market insights and recommendations for insurance buyers. About Lockton What makes Lockton stand apart is also what makes us better: independence. Lockton's private ownership empowers its 12,600+ Associates doing business in over 140 countries to focus solely on clients' risk, insurance and people needs. With expertise that reaches around the globe, Lockton delivers the deep understanding needed to accomplish remarkable results. For more information, visit View original content to download multimedia: SOURCE Lockton
