OpenAI is currently being sued for copyright infringement by The New York Times and authors who claim their content was used to train models without consent. It is also being sued for wrongful death by the parents of a 16-year-old who died by suicide after discussing methods with ChatGPT.
Two people with knowledge of the matter said OpenAI has considered “self insurance,” or putting aside investor funding in order to expand its coverage. The company has raised nearly $60 billion to date, with a substantial amount of the funding contingent on a proposed corporate restructuring.
One of those people said OpenAI had discussed setting up a “captive”—a ringfenced insurance vehicle often used by large companies to manage emerging risks. Big tech companies such as Microsoft, Meta, and Google have used captives to cover Internet-era liabilities such as cyber or social media.
Captives can also carry risks, since a substantial claim can deplete an underfunded captive, leaving the parent company vulnerable.
OpenAI said it has insurance in place and is evaluating different insurance structures as the company grows, but does not currently have a captive and declined to comment on future plans.
