New York-based managing general agent Mayflower Specialty, Ltd. and multinational specialty carrier Hadron have launched the first dedicated affirmative action AI liability program in the United States.
The policies, underwritten by Mayflower and issued through Hadron, expressly cover the entire management liability triad: Errors and Omissions (E&O), Employment Practices Liability (EPL) and Directors and Officers (D&O) insurance.
According to McKinsey’s “State of Artificial Intelligence 2025” report, 88% of organizations have integrated AI into at least one business area, but traditional insurance frameworks are lagging behind.
Many existing policies were developed before the rise of enterprise AI and either fail to mention AI-specific threats or actively exclude them.
Additionally, as SEC requirements regarding AI risk disclosures become more stringent, executives and board members face personal liability for governance choices that are not protected by current coverage.
“Every major technology wave creates a new liability category, and the early underwriters who emerged with true standards defined the market for a generation,” said Jeremy Epstein, founder and CEO of Mayflower Specialty. “Most businesses already have AI liability on their balance sheets without realizing it. Litigation is increasing, regulation is increasing, and affirmative action is all but non-existent. Mayflower was built to close that gap.”
The coverage is structured as an affirmative grant for management liability, employment practices and professional liability arising from the deployment of AI, combined with conditional differential and excess tiers that would fall where traditional policies were silent, sub-limited or exclusive.
Risk managers can close the AI responsibility gap without restructuring core configurations. Mayflower underwrites AI-specific risks, including model bias, drift and hallucinations, using an auditable scoring engine that is NIST and ISO compliant.
Pete Buccola, chief underwriting officer at Hadron Group, said: “Emerging risks require both limiting exposure and the opportunity to thoughtfully consider products and underwriting approaches that address consumer needs.
“Jeremy and his team at Mayflower have leveraged their AI domain expertise and D&O product knowledge to address a significant underwriting gap in the market through proprietary underwriting forms, disciplined pricing and innovative risk selection methods.”
The program is further supported by institutional reinsurance partners and arranged by Aon Reinsurance Solutions.
