AI Risks, Insurance Needs

Thinking of Telling AI Your Secrets? Think Again! The Hidden Risks of Sharing Your Data

Artificial intelligence seamlessly integrates into our routines, bringing unmatched convenience and efficiency to our fingertips. From answering our questions with sophisticated chatbots to providing personalized recommendations, AI tools are becoming increasingly indispensable. However, as we embrace these technological advancements, we must pause and consider the implications of sharing our personal information with these seemingly helpful entities. How much thought do we truly give to where this data goes and how it’s used? While AI promises numerous benefits, a closer look reveals hidden risks, particularly regarding the privacy and security of our data. The recent real-world incidents from 2024-2025 where sharing data with AI has led to unexpected and potentially harmful consequences, such as denied insurance claims and class action lawsuits, urge us to think twice before we share. Cybercrime is advancing rapidly, with AI enabling more precise and devastating attacks, emphasizing the critical need for heightened caution. As consumers increasingly demand stronger data protection, understanding these risks becomes paramount.

The Silent Data Drain: How Our Information Fuels AI

A vast ocean of data lies at the heart of every intelligent AI model, especially the sophisticated Large Language Models (LLMs) that power many popular tools. These models learn and improve by analyzing enormous quantities of information, and a significant portion of this learning comes directly from the data we, as users, provide through our interactions. The more data an AI can access, the more nuanced and accurate its responses become. This means that every question we ask, every document we upload, and every instruction we give contributes to the AI’s growing knowledge base, potentially including sensitive personal details. The data policies of free or non-enterprise versions of AI tools might not be as robust as those of paid or enterprise-level services. This could mean that our data is subject to less stringent protection measures. Even seemingly casual interactions can inadvertently feed these AI models with personal information, highlighting the subtle ways our digital footprints are being collected and processed.

When Sharing Goes Wrong: AI Data Mishaps in 2024-2025

In recent times, the seemingly innocuous act of sharing information with AI tools has led to several concerning incidents that underscore the potential downsides.

The Case of the Chatty AI

Interactions with conversational AI platforms like ChatGPT, Microsoft Copilot, and Google Gemini might feel like private dialogues. Still, the reality is that the data we input can be stored, analyzed, and, in some cases, even inadvertently exposed. While past incidents like the ChatGPT data leaks in 2023-2024 serve as reminders of the inherent vulnerabilities in these systems, new concerns continue to emerge. For instance, the integration of Microsoft Copilot with organizational data raises the risk of over-permissions, potentially leading to the exposure of sensitive information to unauthorized users. A vulnerability discovered in Copilot Studio in 2024 further highlighted these risks, demonstrating how sensitive information about internal cloud services could be leaked. The GEDI-OpenAI case in Italy is another example, where data protection authorities raised concerns about sharing sensitive editorial content for AI training purposes, emphasizing potential violations of data protection regulations. Furthermore, a study conducted in the latter part of 2024 indicated that a notable percentage of prompts across various AI platforms, including ChatGPT, Gemini, and Copilot, could inadvertently expose sensitive data, highlighting the ongoing need for user vigilance.

AI Decides Your Fate: Insurance Claim Denials

The increasing use of AI in processing healthcare insurance claims has sparked significant concern with reports of a rise in claim denials. A survey by the American Medical Association (AMA) in 2025 revealed that most physicians fear using unregulated AI by payers, which is leading to increased prior authorization denials, potentially overriding medical judgment and harming patients. Alarmingly, a 2024 Senate committee report cited in the AMA survey indicated that AI tools have been accused of producing denial rates significantly higher than typical. This trend has led to legal action, as seen in the proposed class action lawsuit against UnitedHealth Group, which alleges that the company’s insurance unit used AI tools to deny Medicare Advantage claims for medically necessary care. The fact that a federal judge allowed this case to proceed underscores the seriousness of these allegations. Similarly, Clarkson Law Firm filed a class action lawsuit against major insurers like Cigna, Humana, and UnitedHealth Group in early 2025, alleging the wrongful rejection of claims based on AI, with claims of some systems reviewing claims in mere seconds. While Cigna has denied using AI for claim denials, these lawsuits highlight the growing scrutiny of AI’s role in healthcare decisions. Data from Komodo Health also points to an increasing rate of prescription drug denials between 2018 and 2024, suggesting a broader trend in AI-driven limitations on healthcare access.

Fighting Back: Class Action Lawsuits Over AI Data Sharing

As public awareness of how AI uses personal data grows, so does the legal pushback against perceived mishandling. Several class action lawsuits have emerged, targeting companies for allegedly sharing user data with AI without proper consent. A notable example is the lawsuit filed against LinkedIn in January 2025. The lawsuit alleged that LinkedIn secretly shared premium users’ private InMail messages with third parties, including its parent company, Microsoft, to train generative AI models without obtaining user consent. Although the initial lawsuit was voluntarily dropped shortly after filing, the allegations highlight the significant privacy concerns surrounding using private communications for AI training.

Furthermore, a Freedom of Information Act (FOIA) request in late 2024 sought detailed information about the Department of Government Efficiency Service’s access to sensitive data and its utilization of AI, indicating governmental interest in ensuring responsible AI data handling. The legal landscape also reflects a broader trend of privacy-related litigation involving generative AI, with lawsuits filed under state wiretapping laws alleging “AI eavesdropping” by chatbots that record customer service interactions without consent. While many of these cases have been voluntarily dismissed, some, like Ambriz v. Google, LLC, have survived motions to dismiss, suggesting a growing legal recognition of potential privacy violations by AI technologies. Although copyright infringement lawsuits against AI companies for training on copyrighted material are not directly about user data sharing, they contribute to the broader legal scrutiny surrounding the data used to develop and operate AI.

To better illustrate the recent incidents, here’s a summary:

Protecting Yourself in the Age of AI

Considering these potential pitfalls, individuals must be more cautious when interacting with AI tools. One of the most fundamental steps is to exercise caution when sharing sensitive personal information with any AI platform. Users should take the time to carefully review the privacy policies of the AI tools to understand how their data is collected, stored, and utilized. Exploring privacy-focused AI alternatives or features can offer an added protection layer when available. Users should consider disabling data sharing settings or opting out of data usage for training purposes. Another essential security measure is ensuring strong, unique passwords and enabling multi-factor authentication for accounts linked to AI services. It’s also advisable to refrain from using company-authorized AI services for personal tasks and vice versa to maintain a clear separation of data. For organizations, establishing transparent AI governance and data protection policies is paramount. Regularly updating AI tools and systems with the latest security patches is crucial to mitigate potential vulnerabilities.

Shaping Tomorrow: Regulation and Responsibility

The legal and regulatory landscape surrounding AI and data privacy is continuously evolving, reflecting the growing recognition of the challenges and opportunities presented by this technology. Initiatives like the EU AI Act signal a move towards stricter governance of AI systems. Regulatory bodies are increasingly scrutinizing the impact of AI on data security and privacy, leading to enforcement actions and the issuance of new guidelines. Ensuring ethical and secure data handling in the AI age requires a shared responsibility between AI developers and users. The ongoing development of the best practices and ethical guidelines for AI usage across various sectors, including law and healthcare, underscores the complexity and importance of this issue. The fact that AI is becoming a target for cyberattacks further complicates the security landscape, necessitating continuous vigilance and adaptation.

What should you do now?

The rise of artificial intelligence offers incredible potential, but it also presents new challenges in safeguarding personal information. The incidents from 2024-2025 serve as stark reminders that sharing data with AI is not without risks. Therefore, we must cultivate a more mindful approach to these technologies. Take a moment to research the privacy policies of your AI platforms. Consider the potential consequences before you input sensitive data. By staying informed and adopting proactive measures, we can navigate the age of AI more securely. Connect with CMIT Solutions to establish robust security controls and gain valuable guidance on the responsible use of tools and technology.

What are your biggest concerns about AI and data privacy? Share your thoughts in the comments below.

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