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Closing the Barn Door After the Horse Has Bolted…………
A paper worth reading if you are responsible for managing risk transfer, especially AI risk transfer. As the insurance industry starts to work out how to manage AI risk.
As with cyber risk transfer, the insurance industry and its clients face a significant challenge ahead. The regulatory environment will develop and introduce requirements for covered organisations to demonstrate governance, oversight, and assurance of AI risk. However, unlike cyber risk, the complexity of AI risk is orders of magnitude greater, and when combined with cyber risk creates major issues for boards.
Page 8 is an important read; it explains the complexity of the AI risk landscape, as it relates to Lines of Insurance, and it’s a stark reminder of the complexity of AI risk and insurance. Page 10 is a nice example of what happens if an AI agent goes rogue, affirming the challenges with managing AI and the potential of AI to create consequential losses.
When reading the paper, it feels like the AI honeymoon is coming to an end. Board governance over AI is critical, and the adoption of an appropriate 3 line of defence framework is critical for the board to demonstrate oversight and assurance of AI risk.
@Thaddeus Dziekanowski Brian D. McCarthy Adam Gladsden Liz Sandwith CFIIA Gerry Kennedy
@Parava Security Solutions Lockton Oliver Brew Eden Fall-Bailey Baiju Devani
#ai #aigovernance
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