Crosby gets $5M insurance coverage for legal work done by AI agents

In short: Crosby, a law firm that uses AI agents, secured $5 million in liability insurance tied to legal work produced by those AI systems.

What happened

Crosby, an AI-focused law firm, obtained $5 million in liability coverage for work performed by its AI agents. Liability insurance is meant to help pay costs if a mistake leads to a claim, similar to how car insurance helps after an accident.

Today, Crosby says its lawyers review every piece of work the AI creates before it goes to a client. The firm’s professional liability coverage includes both the attorneys and the AI systems they supervise.

Founder Ryan Daniels told the paper the long-term goal is to let AI agents handle some legal work without a lawyer reviewing it first. The firm said getting this coverage took about six months.

Crosby chose Testudo, a newer insurer whose ability to write policies is backed by Lloyd’s of London. The report says insurers are still working out how to judge AI-related risk, and policies designed specifically for AI are still limited. The situation has been compared to the early days of cyber insurance, when companies and insurers were still learning what risks were common and how expensive they could be.

Why it matters

More companies are using AI systems to do work that used to be handled only by people. When something goes wrong, a key question is who pays, and who is responsible. This insurance deal shows there is demand for coverage, but it also highlights that insurance alone does not settle whether an AI agent can legally give advice or who is accountable for the result. Those rules are still being worked out by law firms, regulators, courts, and insurers.

Source: NYTimes