Coalition set to expand UK cyber cover as ‘enhanced’ regulatory and litigation risks emerge

Coalition is set to enhance its UK cyber cover as firms face growing regulatory liabilities from a boom in artificial intelligence (AI) adoption, according to the firm’s chief revenue officer Shawn Ram.

During Coalition’s Activate conference 2026 in London on (10 September), Ram revealed that the cyber insurance provider will launch an enhanced AI coverage endorsement in the UK.

Ram told delegates during the session entitled Leading the Future: Active Insurance as Your Growth Engine that the proposition looks to “reduce any concerns” around “AI-related risks being silent on a policy”.

Notably, he revealed that enhancements will also address AI regulatory coverage including regulatory liability endorsement for enterprise firms worth over a £1bn in turnover, as well as coverage for smaller firms regarding the disclosure of AI chatbots following the introduction of Article 50 in the EU AI Act.

Speaking exclusively to Insurance Times, Ram explained that Article 50 is “specifically addressing the need for companies to be transparent when they’re using AI”.

And he warned that firms are open to greater risks if they fail to disclose their use of AI to consumers, in which “fines or penalties can get imposed” and “defence costs” may become required.

He continued: “I believe that as companies embrace AI, particularly in the SME segment, companies are going to utilise chatbots to try and facilitate conversations and drive efficiency.

“With this new requirement to disclose and be transparent around AI, there’s enhanced risks and so we want to help brokers and clients address that risk through this regulatory coverage.”

Emerging trends

While AI continues to be a dynamic force in dramatically altering the risk profile for cyber and technology-related companies, Ram added that another evolving cyber risk in the UK and Europe is wrongful collection.

According to Coalition, wrongful collection refers to the improper gathering or sharing of personal data through ordinary business activities such as the use of tracking pixels and analytics tools without proper consent.

In the UK, GDPR states that personal data shall be “processed lawfully, fairly and in a transparent manner in relation to the data subject”.

Various regulatory bodies have mandated that when a firm is looking to collect data they have to disclose it, Ram explained.

He continued: “It has to be compliant with their own privacy policy.

“Unfortunately, lawyers and other entities are taking advantage of that regulation to impose litigation, fines and penalties on companies so that they do a better job of disclosing”.

In turn, he said that it was important that companies are provided with data on the “risks associated” with deploying pixel-tracking software on their websites including potential privacy policy violations and guidance on how to “mitigate against” them.

He explained that it is an evolving risk worldwide and is a “material problem in the United States” currently.

“During the pandemic, ransomware was the topic of the day. In the States today, it’s wrongful collection,” he confirmed.

“It is what companies are most concerned about with respect to cyber, in addition to AI. But it’s an emerging trend here in the EU and I do believe whether it’s the UK, Germany or France, these are notable countries that are experiencing this dynamic as well”.