Can AI Be a Material Risk? Guide for CFOs
How CFOs should evaluate AI as a material business risk. Framework for risk assessment, financial impact analysis, and disclosure decisions.
From HIPAA gaps to hiring-bias claims, the rules are shifting. We're not lawyers or insurers — we're translators. Our checklists turn dense guidance into plain-English starting points you can take to your team, vendor, or insurer.
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Latest insights from our 46+ article library - real scenarios, practical guidance, zero jargon.
How CFOs should evaluate AI as a material business risk. Framework for risk assessment, financial impact analysis, and disclosure decisions.
How AI in tax preparation creates new audit risks and compliance obligations. IRS expectations and documentation requirements.
Legal boundaries for AI-powered employee monitoring. State privacy laws, consent requirements, and practical implementation guidelines.
Real scenarios, practical questions, and plain-English breakdowns from our growing library of guides.
Browse all articles →Real scenarios that matter:
Scenario A: A clinician pastes patient notes into a general LLM. The vendor stores prompts to improve the model. That's PHI disclosure to a non-BAA vendor → compliance risk.
Scenario B: A telehealth startup sends transcripts to a speech-to-text API without a BAA. Even if encrypted, vendor role still matters under HIPAA.
Plus: 5 questions to ask before using AI with PHI
Professional liability scenarios:
Consultant liability – AI generates flawed analysis that leads to client losses. Professional liability coverage may not extend to AI-assisted work.
Agency malpractice – Marketing copy contains AI hallucinations that trigger regulatory action against client.
Includes contract language and insurance considerations
Common bias scenarios:
Resume filtering bias – Algorithm trained on past "successful" hires may favor certain demographics.
Video interview AI – Tools scoring facial expressions or voice tone risk disability/racial discrimination claims.
Real chatbot failures:
From bots leaking customer data to AI giving harmful advice, customer service automation creates new liability risks most small businesses haven't considered.
Practical prevention checklist included
Coverage gaps to understand:
Cyber policies often cover breaches but AI-specific issues like hallucinated advice, prompt attacks, or non-compliant vendors are gray areas.
Practical policy templates:
Simple, enforceable AI use policies for small teams. Includes data protection rules, approval workflows, and staff training guidelines that actually work.
From HIPAA compliance to hiring bias, insurance gaps to regulatory readiness - we cover the scenarios that matter to real businesses.
Explore All Articles"Ship AI without blind spots"
Before you launch any AI feature, run this quick preflight check. It takes 10 minutes and helps you spot legal, regulatory, and trust blind spots that could become costly problems later.
2-page PDF with fillable checkboxes • No email required
10-Minute Overconfidence Prevention
"The full framework for AI risk management"
If the 10-minute preflight surfaced Medium/High risks, you need the complete toolkit. The AI Risk Playbook provides deep frameworks, conversation scripts, and interactive worksheets to address every risk systematically.
Designed for founders and non-lawyers • Educational only, not legal advice
Avoid the Overconfidence Trap
Plain-English question sets to help you talk with your lawyer, insurer, and vendors — designed to surface gaps without false confidence.
HealthcareHIPAA + AI essentials
HR/RecruitingAI hiring bias prevention
InsuranceCyber vs. AI coverage gaps
Legal RiskAI red flags for lawsuits
RegulationReadiness assessment
Customer TrustAI communication guidelines
Risk AssessmentAI overconfidence stress test
ROI AnalysisTrue cost of AI shortcuts
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We compile plain-English prompts from publicly available sources (e.g., HIPAA, EEOC, NIST, insurer materials). We use AI to draft summaries and a human editor to ensure clarity and remove hype. We do not provide legal interpretations or coverage determinations.