Oct 17, 2024 | 7:00 AM ET
Exclusive
By Murad Hemmadi
Armilla AI has hired a top artificial intelligence executive from TD Bank to lead the development of its technology as the Toronto-based startup courts large firms with its insurance products.
Baiju Devani joined Armilla as CTO last week. At TD, the computer scientist oversaw the AI units of its wealth management, retail banking and other businesses as they built the technology into its products. He also led the engineering and product teams for Layer6, TD’s internal machine-learning research lab.
- Armilla AI has recruited a top AI executive from TD Bank to lead the development of its technology
- The Toronto-based startup sells warranties for the AI products that large firms roll out across their businesses
“AI can go wrong in so many ways,” said Armilla CEO Karthik Ramakrishnan. The startup’s technology attempts to figure out how those flaws could turn into risks for which a company might buy insurance, and how to underwrite them.
For example, a financial services firm might suffer loan losses because the large language models powering its document-processing system misread figures in financial documents. Armilla’s technology can figure out how likely that mistake is and what to charge in premiums to cover it. “It’s not just enough to know the AI models themselves,” Ramakrishnan said. “You need to understand business [and] the actuarial modelling and pricing for insurance.”
Armilla hired Devani in part to bring some of that experience. Before TD, he was chief data officer of insurance giant Aviva’s Canadian operations.
Large companies are increasingly aware of the risks of using AI, according to Devani. In May, TD launched a generative AI assistant that its customer service agents can use to answer questions. As part of that rollout, Devani said he spent as much time with risk groups as he did technology groups to better understand what could go wrong.
Financial institutions and other highly regulated firms are already examining all the possible problems with the AI models they develop in-house. But companies now face new risks from the software they buy from other providers, which increasingly include AI features, Devani said.
AI companies send Armilla their products to assess, winning the firm’s stamp of approval if they comply with regulations and meet industry standards. Armilla also sells warranties to large firms that buy those tools, offering reimbursements if the technology fails to perform as promised.
A growing number of large firms are buying Armillla’s guarantees as they roll out new AI tools, according to Ramakrishnan, although he declined to disclose revenue figures. “Something’s changed in the water in the last four to five months, where AI risk is now top of mind,” he said.
The startup currently has 12 staff, and has raised about US$5.5 million in venture capital to date, according to Ramakrishnan. Backers include Ottawa financier Mistral as well as insurance firms Greenlight Re and Chaucer. Devani replaces Rahm Hafiz, an Armilla co-founder who left at the start of the year when some of the startup’s executives spun out its security products.
