AI Liability Risks in Healthcare Insurance Highlighted by Tego CEO

• •AI can make repeated errors, complicating risk assessment in healthcare.
• •Insurance policies may deny claims due to unclear liability in AI incidents.
• •Governance practices are not keeping pace with AI adoption, according to APRA.

A hybrid conference revealed significant risks associated with AI in healthcare, emphasizing that AI can make the same errors repeatedly, impacting underwriting practices. Eric Lowenstein, CEO of Tego, warned that insurance policies may deny liability due to a 'stack gap' in accountability for AI-related incidents. This gap arises as various insurers dispute responsibility, complicating claims processes. The Australian Prudential Regulation Authority (APRA) has cautioned that governance practices are lagging behind AI adoption, urging boards to critically assess AI risks. The implications of these findings could reshape healthcare underwriting and extend to commercial insurance. Lowenstein noted that the traditional concept of fault may no longer apply in cases involving AI decisions. A systemic risk is posed by reliance on a few foundational AI models, which could lead to widespread claims from a single defect. The current status indicates ongoing discussions and developments in AI liability insurance.