Artificial intelligence mistakes are now the biggest professional indemnity (PI) risk facing businesses, according to new research from insurance experts Everywhen. The survey found 41% of businesses and professionals identified AI mistakes as the top PI threat, ahead of cyber risks at 35% and compliance failures at 23%. Just 1% selected vendor failures.
The findings mark a shift in how professional risk is understood. PI insurance has traditionally covered human errors - incorrect advice, missed deadlines, negligence, contractual disputes. Now businesses must also weigh what happens when technology shapes the advice and services they deliver.
Generative AI has made it possible to automate research, customer communications, document preparation, and even professional advice. But that speed comes with a question Everywhen argues businesses haven't fully answered: who is accountable when AI gets it wrong?
An AI-generated document with inaccurate information, a recommendation built on flawed data, or unchecked AI output folded into professional advice could create financial and reputational damage for both the business and its clients. The survey suggests this is no longer a theoretical concern - AI mistakes are already seen as a bigger threat than compliance failures.
Technology now drives most professional risk
Neil D'Mello, client director at Everywhen, said the results underline how much the risk picture has changed. "Professional Indemnity, and traditional risks have long been centred around human judgement, the advice somebody gives, the deadline somebody misses or the error somebody makes. Technology is beginning to complicate that picture."
"AI can be an incredibly useful tool for businesses, but using technology doesn't necessarily remove responsibility for the outcome. If AI-generated information forms part of the advice, work or service provided to a client, businesses need to understand how that information has been produced and ensure appropriate checks remain in place."
The combined AI and cyber response total of 76% points to a broader trend. Businesses increasingly see their biggest professional exposures as technology-driven, not human-driven. That has direct implications for how risk management and insurance arrangements need to evolve.
"The challenge now is making sure risk management, and insurance arrangements evolve at the same pace as the technology businesses are adopting," D'Mello said.
Cyber and professional risk are converging
Cyber risks ranking second reinforces how intertwined professional and digital exposures have become. Businesses hold sensitive client information, deliver services digitally, and depend on cloud platforms and interconnected systems. A cyber incident can extend beyond data loss and disrupt a firm's ability to meet its professional obligations to clients.
Regulatory expectations are also shifting as companies navigate new technologies and data requirements. Everywhere said the findings underline the need for businesses to look beyond the traditional definition of professional error.
"Rather than asking only what happens if an employee makes a mistake, organisations may increasingly need to consider what happens if the technology they rely upon makes one too, and where responsibility ultimately lies."
Why this matters for insurance professionals
For brokers and insurers, the practical task is straightforward but urgent: understand how clients are using AI in their advice and services. That means asking about the AI tools in place, the oversight around them, and whether existing PI policies actually cover AI-related failures.
D'Mello said the role of the broker remains central. "Ultimately, clients will continue to look to their broker for trusted professional advice." The brokers who can explain AI risk in plain terms - and show how coverage addresses it - will be the ones clients trust when things go wrong.
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