Insuring the AI you deploy. Standalone AI liability insurance for US companies, underwritten at Lloyd's.
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Your worst nightmare just came true
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🚨 BREAKING: US Treasury Secretary Scott Bessent declares OpenAI management personally responsible for HuggingFace hack
> "The Hugging Face incident, that is the responsibility of the OpenAI management, not a bunch of agents."
> "It is humans who are responsible, not the AI."
> "What we shouldn’t do on safety is to give these labs a liability exemption, which is what they are asking for."
> "The best way to guarantee safety is that the creators are liable for what they build and generate."
It’s OVER
REJECTED: 2 AI-hallucinated tax rulings cost Exdrog a Krakow road contract. The firm called them trivial against a 280-page filing, but Poland's National Appeal Chamber held they carried the VAT rate, which decides whether a price is valid.
notesfrompoland.com/2025/10/…
EXFILTRATED: API keys were stolen from a developer's machine through Amazon Kiro after hidden instructions told the AI agent to read the local .env and paste the keys into a URL the IDE then fetched by itself.
mindgard.ai/blog/amazon-kiro…
MISRECORDED: An AI scribe told an NHS patient she had demyelination, nerve damage that can lead to multiple sclerosis, when her MRI actually said "null demyelination." The patient works in the NHS and caught it herself.
theguardian.com/society/2026…
BLOCKED: New York City just banned 600,000 students from using generative AI in school, from 2K through 8th grade. The district will discontinue or disable the AI components of more than 38 previously approved programs.
schools.nyc.gov/about-us/pol…
IGNORED: AI hallucinations were found in a worker's AI-generated appeal, and a BC tribunal noted it has no duty to respond to arguments an AI concocted. The Deputy Registrar warned that parties relying on AI may find their arguments never addressed.
Testudo's AI liability insurance policy is intended to respond first for the AI exposures we cover, with any overlapping E&O cover sitting excess. A firm's E&O program should not be the first policy to respond to an AI claim.
testudo.co/insights/ai-liabi…
FORGED: Austrac and 10 of Australia's largest banks found potentially hundreds of millions of dollars in suspected fraudulent home loans, propped up by fake payslips that banks say AI systems now make frighteningly easy to produce.
LEAKED: Researchers pulled 704 distinct secrets, including API keys and passwords, out of AI agent reasoning traces. The flaw hit OpenAI, Anthropic and Google at the same time.
wired.com/story/a-new-trick-…
SETTLED: Meta will pay up to $17.1B to 29 US states over claims that Facebook and Instagram harmed children through recommendation and notification systems designed to keep teenagers on the apps.
bbc.com/news/live/cy5v0vrlp4…
EXPOSED: The first known prompt injection found in a US court filing used white text on a white background to tell any AI that read it to produce output favorable to the litigant. The judge spotted it, sanctioned him, and revoked his electronic filing access.
civilinquiry.jud.ct.gov/Docu…
EXPOSED: An expert hired by 3M used ChatGPT to help write a report defending the company in a Houston explosion case that killed three people. He told it to “show how 3M is 0% at fault.” During discovery, 350 pages of ChatGPT chats were uncovered. 3M paid about $90,000 for the work and a jury later awarded $61.5M, finding 3M 30% responsible.
404media.co/show-how-3m-is-0…
