Standard Business Insurance Is Being Quietly Rewritten to Exclude AI Claims

Insurance rating organization ISO issued new endorsement forms, CG 40 47 and CG 40 48, in January 2026. Their function is narrow but consequential: they exclude generative-AI-related bodily injury, property damage, and advertising injury claims from standard commercial general liability policies, according to Fenwick & West.

That exclusion did not stay contained to CGL policies. Major insurers Chubb, Travelers, and Berkshire Hathaway have since sought and won state regulatory approval, at a rate above 80% across the states where they filed, to extend similar AI exclusions to directors and officers coverage and errors and omissions coverage as well, per Claims Journal reporting from July 20, 2026. D&O and E&O policies are exactly the coverage a software company, and specifically an AI SaaS vendor, would expect to lean on if a customer or third party brought a claim tied to an AI product's output or behavior.

The practical effect is that the standard liability insurance many companies already carry, and may not have revisited recently, is being rewritten to carve out AI-related claims specifically, right as AI adoption across those same companies is climbing. A policy that covered a claim last year may not cover a similar claim going forward if the underlying cause traces back to a generative AI system.

For any company building or deploying AI products, this is worth an actual conversation with a broker rather than an assumption that existing coverage carries over. Ask directly whether your CGL, D&O, and E&O policies currently include an AI exclusion endorsement, and if so, what specific coverage gap that leaves for AI-related claims against your business.