Spotlight on AI performance guarantee

October 19, 2023

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AI performance guarantee is being purchased by AI vendors to achieve the following goals:

  • Differentiate from their competitors
  • Build trust about their algorithm among buyers
  • Provide a defined mechanism for risk transfer in the event of AI underperformance

Policyholders have a wide range of AI use cases as shown in the table below.

AI Use Case Companies that bought AI Insurance
Cybersecurity Deep Instinct’s endpoint security software uses deep learning algorithms and it covers 3 million USD for each client upon successful undetected ransomware attack.
Battery analytics Twaice’s AI predicts the state of health of a battery without expensive physical tests. If the predicted state of health of the battery is off by 2%, their customers are guaranteed to receive 8 times the money they paid to Twaice.
Content moderation Spectrum Labs AI based content moderation tools detect harmful content on social media, e-commerce etc and it refunds a certain percentage of the subscription fee to the client. The clients are guaranteed this through a third party AI Insurance product.
Fraud prevention Fugu, a Series A company, uses AI to validate transactions for online sellers. If any of the accepted transactions are later found to be fraudulent, the seller is indemnified for the value of these transactions.