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Artificial Intelligence: Know the Risks and Protect Your Organization

June 26, 2024
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It has quickly progressed from a futuristic concept to now seemingly a part of everyday life. What is it? Artificial Intelligence (AI) represents a computer system’s capability to perform human tasks. Though still evolving, AI has empowered individuals and businesses to operate in new and more efficient ways.

Advancements in AI have diversified its impact. It can assist with writing, analyzing data and even perform initial evaluations of job candidates. While its benefits are appealing, AI can take organizations down slippery slopes if not used properly, so it’s important to understand, address and mitigate the risks involved.

Data and privacy

AI depends on vast amounts of data to function, which can include personal and sensitive information. The potential for unauthorized access, theft or exposure of sensitive data is heightened with AI tools.

With data collection, processing and storage, comes regulatory considerations and challenges. Those on the forefront include the EU’s General Data Protection Regulation and California’s Consumer Privacy Act, which govern and impose strict guidelines around consent and transparency.

The regulatory environment will evolve with AI, prompting organizations to adapt to avoid fines and penalties arising out of potential non-compliance.

Don’t plagiarize

Information found on the internet is often used to train AI programs. It’s called data scraping, and it has faced scrutiny as some claim the data is being collected without consent. Some , such as the New York Times, are claiming it is a violation of copyright laws.

With the use of generative AI models becoming more prevalent, there is not yet a clear answer as to whether the use of protected work in training AI models constitutes fair use, or if AI outputs are eligible for copyright protection.

Businesses in a variety of industries, with some degree of online or media presence, could face criticism. If your organization uses artificial intelligence, make sure you are not using writing or designs that have been created by others without providing proper credit to the creator. It could keep you out of court and save money.

Deepfakes

It sounds like something out of a science fiction thriller, but it’s here and it’s becoming more sophisticated.

Deepfake technology uses AI to create fake audio and video that appear to be real, even to a suspecting individual. Businesses face the risk of financial loss and wire fraud, privacy violations and reputational damage.

Several incidents have made headlines as malicious actors have utilized fabricated content to socially engineer employees. Take, for example, the recent deepfake video call that impersonated a multi-national corporation’s CEO and other employees to defraud the company of $25 million.

Efforts are underway to combat deepfake risk, including detection tools, authentication measures and raising awareness. It’s crucial to take charge by embracing cybersecurity defenses and increasing efficacy around employee awareness training. These are some of the best means for organizations to equip themselves in mitigating this emerging risk.

Be proactive

With diverse and impactful applications, artificial intelligence offers considerable potential for businesses of all sizes and types. Consider the following when assessing your organization’s AI initiatives.

  • Develop and enforce an AI use policy.
  • Test the technology and explore how certain use cases may drive efficiency.
  • Prioritize risk management procedures around the use of data.
  • Be aware of regulatory requirements.
  • Be transparent about the use of AI technology.
  • Use AI to supplement human input, rather than replace. The human ability to reason cannot be replaced.

Maintain a competitive edge by embracing innovative and new technologies that promise new opportunity. As AI’s influence evolves and expands, it’s clear that adopting a risk management mindset is key to protecting your business.


Please contact me below to evaluate your risks and create a plan to safeguard your organization.

Property & Casualty - Specialty Risk | Cleveland
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