Insurance experts warn small businesses about AI security gaps
Cybersecurity and insurance specialists told Paducah business owners Tuesday that most companies lack basic protections against AI-enabled attacks. The Paducah Area Chamber of Commerce hosted the seminar as part of Small Business Month, focusing on both the opportunities and risks AI poses to local operations.
The panel centered on two main threats: malicious AI attacks targeting employees and coverage gaps in existing insurance policies.
How AI is being weaponized against employees
Johnny Sanders, a cybersecurity expert at SOMA Cyber in Paducah, described how attackers use AI to craft convincing fake emails and phone calls designed to extract sensitive information from staff. The technology has made these scams far more sophisticated than earlier phishing attempts.
"Gone are the days when the Saudi prince was trying to share this wealth with you through email," Sanders said.
Policy gaps leave businesses exposed
Jessica Newman of Advantage Insurance Services emphasized that most cybersecurity insurance policies only cover losses from malicious attacks. If an employee accidentally shares confidential data with an AI tool or falls for a scam, the business typically bears the cost unless it purchases additional coverage.
Newman outlined what that additional coverage requires. Insurers assess industry risk, company size, and past incidents before pricing supplemental policies. The cost varies significantly based on those factors.
She also stressed the need for clear written policies on AI use. Without explicit rules, businesses create unnecessary exposure.
"If you find out that you have someone in your organization using that platform, what are you going to do?" Newman asked, using a hypothetical breach scenario. "You're allowing your organization to be open to a breach, so you have to have that as a part of the conversation when you're talking about cybersecurity."
What businesses should do now
Sandra Wilson, president and CEO of the Paducah Area Chamber of Commerce, said the seminar demonstrated that protective measures exist and are within reach for small businesses.
The chamber plans to continue educating business owners on AI through a small business cohort program launching later this summer. AI for Insurance professionals should review their current policies to identify coverage gaps related to employee errors and unintentional data exposure.
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