Direct answer
Most filed AI exclusions are written broadly enough to reach shadow AI — unsanctioned tools employees use without approval. Forms like Verisk CG 40 47 and Berkley PC 51380 apply to AI use generally and do not carve out authorization status. Whether a specific claim is excluded still depends on the exact wording and the facts, so review your endorsement language.
Yes. AI exclusion endorsements like Verisk CG 40 47 and Berkley PC 51380 use broad language covering any AI use, including unsanctioned shadow AI tools used by employees without authorization.
Scope
General business and insurance-risk analysis, not legal advice. Shadow AI can create legal exposure regardless of insurance; the exclusion question is separate from liability and concerns whether your coverage responds when the AI involved was unsanctioned. Broad AI exclusions generally do not distinguish between approved and shadow AI use — typical wording excludes claims 'arising out of' AI use without referencing authorization, so unsanctioned use is not obviously carved out. This applies to the Verisk and Berkley exclusion forms currently filed and adopted across several states; whether a specific claim is excluded still depends on the exact wording and facts. Confirm specifics with your broker.
Operational implication
An unmanaged AI tool used quietly by one employee can sit inside the same exclusion as sanctioned AI. Knowing where shadow AI exists is a prerequisite to understanding your coverage position.
Carrier Endorsement Details
Excludes bodily injury, property damage, and personal/advertising injury arising out of generative AI under Coverage A and Coverage B. Part of the January 2026 ISO edition; companion forms address narrower scopes: CG 40 48 (Coverage B / personal and advertising injury only) and CG 35 08 (products and completed operations).
Key Provisions
Excludes BI and PD (Coverage A) and personal/advertising injury (Coverage B) arising from generative AI
Companion form CG 40 48 limits the exclusion to Coverage B only
Companion form CG 35 08 applies the exclusion to products/completed operations
Applies regardless of whether AI is owned, licensed, or embedded
Type: exclusion Policies: CGL
Absolute AI exclusion for D&O, E&O, and Fiduciary Liability — eliminates coverage for any claim "based upon, arising out of, or attributable to" AI use.
Key Provisions
Absolute exclusion — no coverage for any AI-related claim
Applies to claims 'based upon, arising out of, or attributable to' AI
Covers owned, licensed, and third-party AI systems
No carve-back for incidental AI use
Type: exclusion Policies: D&O, E&O, Fiduciary
Disclaimer: This content is provided for informational purposes only and does not constitute legal advice. AI regulations and insurance policy terms change frequently. Consult with a qualified attorney or insurance professional for advice specific to your situation. Gridex makes no warranties regarding the accuracy or completeness of this information.