AI in HR: When Efficiency Adds to Risks

By: Sarah Braughler | November 25, 2025

Sarah is the Vice President of Risk Management at United Educators. She is a member of the University Risk Management and Insurance Association, the National Association of College and University Attorneys, and the Kentucky Bar Association. Sarah has written extensively on enterprise risk management matters and managed complex insurance claims and high exposure litigation.

Topics: Artificial Intelligence | Risk Insider

Artificial intelligence is reshaping how organizations recruit, hire and manage people. For human resources and risk leaders, the appeal is clear: faster screening, leaner processes and data-driven decisions. But recent lawsuits suggest that AI efficiency can come with a hidden price, one that can raise liability, not lower it.

Two high-profile cases illustrate the risk. In August, SiriusXM was sued for alleged age discrimination tied to its use of AI screening tools, according to employment law firm Fisher Phillips. Workday faced a proposed class action claiming that its AI systems disproportionately screened out job seekers by race, age and disability, as noted by Holland & Hart. Together, these cases signal that plaintiffs’ lawyers are catching up with possible AI-driven bias and employers cannot rely on vendors to shoulder that risk.

When Algorithms Go Off Script

AI tools promise objectivity by removing human subjectivity. Yet, algorithms learn from historical data, and those data sets can reflect the inequities organizations hope to avoid. The result: models that unintentionally replicate bias, particularly in HR decisions.

Even well-intentioned automation can trigger claims under Title VII of the Civil Rights Act, the Age Discrimination in Employment Act or comparable state laws. Plaintiffs’ attorneys already have seized on potential algorithmic bias as a new form of systemic discrimination.

The HR Lifecycle Under the Microscope

Each stage of the HR lifecycle carries potential exposure:

Recruiting and hiring: Automated résumé filters and video interview scoring can unintentionally disadvantage protected groups.
Performance management: Predictive analytics may rate employees using incomplete or skewed data, prompting claims of unfair treatment.
Termination decisions: Overreliance on AI outputs without human oversight can lead to wrongful termination or retaliation allegations.

Using AI tools in the HR lifecycle without human review can undermine fairness and compliance at multiple decision points. When employees or applicants believe an opaque system made the call, they often perceive discrimination, even if none was intended. That perception can drive litigation and erode trust.

A New Frontier for Liability

How insurers and brokers weigh the employment practices liability (EPL) risks associated with AI-related bias is an emerging question.

The reputational risk can be just as damaging. Organizations seen as using “black box” technology for personnel decisions may face public backlash and increased legal scrutiny. This is especially true as states like California advance new rules requiring transparency and fairness audits for automated employment tools, according to Holland & Hart’s review of the Workday case.

Guardrails That Work

Mitigating the risk of AI in HR requires deliberate governance. Some organizations may need to begin by building a foundation and establishing an AI use policy. As always, working with legal counsel on compliance is key and part of keeping abreast of state laws in this area and determining which may apply to your company.

Savvy organizations can reduce exposure by embedding risk management early in the process:

Map the tools. Identify every point in the HR lifecycle where AI is applied and list who owns oversight.
Demand transparency. Require vendors to disclose how algorithms are trained, tested and monitored for bias.
Audit regularly. Conduct and document independent bias testing, especially before and after deployment.
Keep humans in the loop. Maintain human review for final employment decisions.
Bridge silos. Ensure HR, legal, compliance and risk teams collaborate on evaluating and approving AI tools.
Train for accountability. Educate HR staff on both the benefits and limits of AI systems.

Balancing Innovation and Risk

AI can help organizations attract talent and improve workforce decisions when used with the same rigor applied to any other enterprise risk.

As the SiriusXM and Workday cases show, the question is no longer whether AI can create liability. It is whether organizations are managing that liability as thoughtfully as they are embracing the technology.

These insights are drawn in part from Using Artificial Intelligence Tools in the HR Lifecycle: Risks to Consider | United Educators by Heather Salko. &

Specialized Risk Control: How Industry Expertise Transforms Insurance Partnerships

When insurers understand the unique challenges of specialized industries, they can deliver risk management solutions that protect operations while supporting growth. Leading carriers are investing in sector-specific expertise to help clients navigate complex exposures.

By: Intact Insurance Specialty Solutions | November 19, 2025

In today’s increasingly complex business environment, companies operating in specialized sectors face unique risk challenges that generic insurance solutions often fail to address. From telecommunications networks vulnerable to cyber threats to medical technology manufacturers navigating product liability concerns, each industry requires tailored risk management strategies. This reality has prompted a shift in how insurance carriers approach risk control, with many now deploying specialists who bring deep industry knowledge to their client partnerships.

“Our goal is simple,” said Craig Collins, Head of Portfolio Quality Assessments and Risk Control, U.S. for Intact Insurance Specialty Solutions. “Get out there. Be seen. Build trust. And deliver the kind of service that makes brokers want to work with us again and again.”

Serving Diverse Economic Sectors

Craig Collins, Head of Portfolio Quality Assessments and Risk Control, U.S., Intact Insurance Specialty Solutions

The modern economy demands insurance partners who understand the nuances of specialized industries. Telecommunications companies managing vast fleets and network infrastructure face different exposures than electronics manufacturers dealing with supply chain disruptions and product safety requirements. Medical technology firms navigate regulatory compliance while information technology companies grapple with evolving cyber threats.

This diversity of risk requires more than traditional insurance coverage. It demands consultative partnerships where risk control professionals understand not just the theory of risk management, but the practical realities of how businesses operate within their specific sectors. Companies need advisors who can identify vulnerabilities unique to their industry and recommend solutions that align with operational constraints.

The evolution of specialized risk control reflects this need. What once operated as separate, siloed units supporting individual industries has transformed into integrated teams that maintain deep expertise while sharing knowledge across sectors. This approach allows risk control professionals to address the increasingly interconnected nature of modern business risks, where a manufacturing company might also face significant cyber exposures or a technology firm might need fleet safety management.

The Advantage of Industry-Specific Expertise

When risk control professionals bring real-world experience from the industries they serve, the dynamic changes from inspection to partnership. These specialists arrive with credibility and fluency in technical areas, allowing them to quickly identify critical exposures and offer practical solutions.

Rather than delivering generic recommendations, industry-experienced consultants can prioritize interventions that will have the greatest impact on reducing claims. They understand which risks are inherent to the business model and which can be effectively mitigated without disrupting operations. This targeted approach helps companies make meaningful improvements without becoming overwhelmed by compliance requirements.

The benefits extend beyond individual client engagements. Risk control teams that collaborate globally can share insights on emerging threats and proven solutions. Cross-border knowledge sharing brings new tools, case studies, and real-world learnings into every client interaction. When a wildfire mitigation strategy proves effective in one region, or a cyber risk evaluation framework delivers results in another market, these insights can be adapted and applied across the portfolio.

For brokers, this specialized expertise translates into stronger renewal packages and improved client retention. When risk control professionals help clients make operational improvements that reduce future claims, it strengthens the entire insurance relationship. The value extends throughout the policy year, not just at the point of quote, creating ongoing touchpoints that reinforce the partnership.

Real-World Impact: Case Studies in Action

The true measure of specialized risk control lies in its ability to transform challenging situations into success stories. Consider a large telecommunications company that faced mounting fleet losses, with claim frequency rising and severity spiking to the point where its future insurability was in question. The company risked losing access to the coverage its operations depended on.

Instead of non-renewing the client, Intact’s Risk Control team implemented a focused intervention plan. They collaborated with the client’s leadership team to identify root causes of loss activity, then developed a structured service plan to strengthen fleet management practices. This included creating standardized operating procedures for driver behavior monitoring and accident investigation, all supported by consistent follow-up and ongoing risk control engagement.

“This wasn’t a quick fix. It was a strategic, hands-on effort that delivered a measurable impact,” Collins explained. The situation stabilized, losses declined, and the client remained in the portfolio, stronger than before.

This case exemplifies how specialized risk control creates value for all stakeholders. The client avoided a potential business disruption, the broker retained an important account, and the carrier transformed a problematic risk into a sustainable partnership. The success stemmed from the risk control team’s ability to engage rather than investigate, positioning themselves as advisors who show up, stay involved, and help clients improve.

Similar transformations occur across various specialized sectors. Risk control consultants trained in multiple segments can support accounts with overlapping exposures, addressing everything from cyber risk evaluation and ergonomic program management to fire protection specification consultation and network security evaluations. This flexibility allows teams to meet regional demands without sacrificing expertise, ensuring that clients receive relevant, actionable guidance regardless of their industry or location.

Looking Forward

As businesses continue to navigate evolving risks, the demand for specialized risk control expertise will only intensify. Companies that partner with carriers offering deep industry knowledge and consultative risk management services position themselves to not just survive challenges but to thrive despite them. The key lies in finding insurance partners who view risk control not as a compliance exercise but as a strategic tool for business improvement.

For organizations ready to leverage specialized risk control expertise, the benefits can include reduced claim frequency, improved operational efficiency, and stronger insurability over time. “The team’s evolution reflects that mindset,” Collins said. “By developing common frameworks across specialties, the team can flex to meet regional demands without losing expertise.”

To learn more, visit https://www.intactspecialty.com.

This article is provided for general informational purposes only and does not constitute and is not intended to take the place of legal or risk management advice. Readers should consult their own legal counsel or other representatives for any such advice. Intact hereby disclaims any and all liability arising out of the information contained herein.

Intact Insurance Specialty Solutions is a marketing brand for the insurance company subsidiaries of Intact Insurance Group USA LLC. Our solutions are backed by the financial strength of Atlantic Specialty Insurance Company, a subsidiary of Intact Financial Corporation (TSX:IFC), rated A.M. BEST A+ | FITCH AA | MOODY’S A1.

This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Intact Insurance Specialty Solutions. The editorial staff of Risk & Insurance had no role in its preparation.

Intact Insurance Specialty Solutions offers a broad range of specialty insurance products through independent agencies, regional and national brokers, wholesalers and managing general agencies. Each business is managed by an experienced team of specialty insurance professionals focused on a specific customer group or industry segment and providing distinct products and tailored coverages and services. Targeted solutions include group accident and health; commercial and contract surety; entertainment; environmental; excess property; financial institutions; financial services; inland marine; management liability; ocean marine; technology; trade credit and tuition refund. Intact Insurance Specialty Solutions is backed by the financial strength of Atlantic Specialty Insurance Company (Rated A+ by AM Best), a subsidiary of Intact Financial Corporation.