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The relevant question is not only what loss occurred, but what the system was allowed to do, what it actually did, and whether that reconstructed loss can support insurance claim recovery. This paper addresses losses in which the insured's AI system is in the causal chain, including externally triggered failures such as prompt injection, retrieval-augmented generation (RAG) poisoning, malicious tool output, credential misuse, and data poisoning.\n  Specifically, this paper introduces CER, a use-case-level diagnostic for AI residual risk transfer. C (control boundary) asks whether the system had an enforceable operating envelope. 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