CFC, a specialist insurance provider focused on emerging risks, has introduced affirmative artificial intelligence (AI) coverage as part of its Intellectual Property policy.
The new wording is intended to provide greater clarity over how the policy responds to intellectual property claims involving AI.
Businesses are increasingly using AI in the development, creation and commercialisation of intellectual property. CFC said this is also giving rise to questions around the ownership and use of intellectual property, including issues relating to training data, infringement, liability and AI-generated material.
The legal position remains subject to differences between jurisdictions and continues to develop as regulators and courts address the application of existing IP rules to AI.
According to CFC, its affirmative AI wording is intended to clarify the policy response without altering its underlying scope of cover. Where an intellectual property claim involving AI would otherwise fall within the policy’s coverage requirements, the wording confirms that the involvement of AI does not, in itself, create uncertainty over whether the claim can be covered.
CFC said the approach takes account of potential exposures arising at different points in the AI lifecycle. These may include the data used to train AI models, the algorithms and underlying technology, as well as content and other material produced by AI systems. CFC also highlighted that businesses using or deploying AI may face allegations of intellectual property infringement, even where the relevant technology has been developed by a third-party provider.
“AI is creating enormous opportunities for businesses, but it is also introducing new and increasingly complex intellectual property risks,” commented Maddi Brown, IP Practice Leader at CFC. “Questions can arise at every stage of the AI lifecycle, from the data used to train a model and the technology itself to the outputs it produces.
“The legal and regulatory position remains uncertain and varies significantly across jurisdictions, making it difficult for businesses to assess their exposure. As investment and innovation in AI continue, we also expect businesses to place greater emphasis on protecting and enforcing the intellectual property rights associated with these technologies.
“Our affirmative AI wording gives policyholders greater clarity. It confirms that where an AI-related intellectual property claim would otherwise be covered, the involvement of AI alone does not create uncertainty around how the policy responds. While no one can predict exactly how the relationship between AI and intellectual property will develop, we can give businesses confidence that they have specialist protection in place as they adopt the latest AI tools.”
CFC said its Intellectual Property policy is structured as standalone cover rather than providing AI-related IP protection solely through a limited policy extension. The company said the addition of affirmative AI coverage builds on this existing specialist offering and is intended to reflect the ways businesses are now developing, using and commercialising intellectual property.
The launch is part of CFC’s broader programme to introduce affirmative AI coverage across its insurance portfolio. The company said the programme is focused on providing more explicit policy language around AI as its use becomes more established across business operations.
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