Artificial intelligence is finding its way into all kinds of contractor workflows.
Estimating. Takeoffs. Measurements. Comparing plans. Equipment diagnostics. Marketing.
For many contractors, AI isn’t some futuristic technology anymore. It’s simply becoming another tool in the toolbox. But as the technology evolves, the insurance industry is evolving alongside it—and that is a conversation worth having.
According to a recent report from Trades Coverage, generative AI exclusions have been filed for commercial insurance policies in nearly every state. That doesn’t mean every contractor currently has an AI exclusion on their policy. These forms are optional endorsements unless a carrier’s program rules require them, and a filing with a state insurance regulator does not necessarily mean an exclusion has been attached to an individual policy.
That’s an important distinction.
It also means there is an opportunity for contractors and their insurance advisors to get ahead of the issue rather than waiting for a claim to force the conversation.
Why Are Insurers Paying Attention?
What happens if an AI-assisted step in your workflow contributes to an injury, property damage, an advertising claim or a problem discovered after the work is finished?
That’s where insurance coverage becomes an important question.
The Trades Coverage report found 4,078 filed generative AI exclusion adoptions across 49 states and the District of Columbia as of July 31, 2026. Most involved general liability, commercial umbrella/excess and commercial package policies—the same types of coverage commonly purchased by contractors and other small businesses.
That ‘s a good reason to start asking questions.
This Doesn’t Mean Your Policy Doesn’t Cover You
One of the most important takeaways from the report is that a filed exclusion is not the same thing as an exclusion on your individual policy.
Some insurers may be waiting to see how AI-related claims develop before making changes. Others may eventually decide that specific risks need to be addressed differently.
In other words, this is a rapidly developing area of insurance—not a finished story.
The insurance industry has navigated this kind of evolution before. In many ways, the emerging AI issue echoes the way cyber risk evolved just a few years ago. As cyber exposures became increasingly difficult to address within traditional commercial policies, standalone cyber insurance developed to address those risks.
The generative AI insurance market hasn’t reached that point yet, and there are currently few options to buy back coverage specifically excluded by these forms for contractors. But insurance solutions are being actively developed as the risks become better understood.
So What Should a Contractor Do?
You don’t need to become an insurance expert—or an AI expert—to start the conversation.
Instead, take a look at how your business is actually using AI and bring those uses to your Deeley insurance advisor.
Ask:
- Are we currently using generative AI anywhere in our estimating, bidding, design, project management or marketing processes?
- Does our insurance policy contain a generative AI exclusion?
- If it does, what exactly does the exclusion apply to?
- Are there situations where an AI-assisted process could create a liability exposure for our business?
- Are there risk-management steps we should take when using AI?
And perhaps the most important question:
- If our use of AI changes, should our insurance program change with it?
AI Is Moving Fast. Your Insurance Conversation Should, Too.
The important thing isn’t to be afraid of using AI.
It’s to understand what you’re using, how you’re using it and where responsibility ultimately falls if something goes wrong.
AI can help contractors work more efficiently, process information faster and tackle tasks that once required considerably more time. Like any other tool, though, it introduces questions that businesses need to consider. The good news is that you don’t have to figure it out alone.
Your insurance policy shouldn’t be something you only think about after something goes wrong. As new technology changes the way you do business, it’s worth making sure your insurance program changes with it.
At Deeley Insurance Group, we show up, we ask the questions, and we DIG deeper to understand your business and your unique exposures. We help you stay a step ahead. AI is changing the way contractors work. Let’s make sure your insurance keeps up.
Reach out to Deeley’s friendly risk management experts today. Call or text us at 410.213.54600.
