How Genezio Solves AI Hallucination in Customer Service

AI hallucination is quickly becoming a serious concern for Customer Care teams. As more companies rely on AI to handle support conversations, the risk of these systems giving wrong or irrelevant answers is growing. And customers are noticing.

According to a Forrester Consulting report , users rated their most recent chatbot experience just 6.4 out of 10. That’s barely a passing grade. Nearly 40% described their interaction as negative. What happens next is costly: 30% of customers said they would abandon their purchase, switch to a different brand, or share the bad experience with others.

This kind of disappointment usually starts with an AI agent going off-track. Sometimes it gives the wrong answer. Other times, it doesn’t understand the question or fills in gaps with made-up responses. These mistakes, known as AI hallucinations, can frustrate customers and damage your reputation.

For Customer Care Executives, this leads to an urgent question: how do you keep AI agents in check without slowing down your operations?

In this article, we’ll look at what AI hallucination in customer service means, and how you can stop it before it hurts your team or your business. We’ll also show how Genezio helps you test and monitor AI agents, so they stay accurate and aligned with what your customers actually need.

What is AI hallucination?

AI hallucination happens when an AI system gives answers that are wrong, irrelevant, or made-up. Unlike human mistakes, which can come from confusion or oversight, AI hallucinations often result from poor training data, gaps in the model, or lack of proper testing. In customer service, this means the AI might give customers incorrect information, suggest off-topic solutions, or fail to understand the request.

AI hallucinations can range from small errors, like misreading a question, to more serious cases, such as giving false financial information or inappropriate replies. For businesses that use AI in customer interactions, these errors can lead to lost sales, upset customers, and even legal risk.

Types of AI hallucinations in customer service

AI hallucinations can show up in different ways. One common type is when the AI gives factually incorrect information. For example, an AI might tell a customer that an item is out of stock when it’s actually available. This might sound harmless at first, but it can quickly turn into something more serious. Air Canada’s chatbot once gave a customer false information about bereavement discounts. The customer followed the advice and booked a flight, only to be denied the discount later. A court later ruled that the airline was responsible for the chatbot’s misinformation.

Another type is when the AI provides responses that don’t match the situation. This could be an AI suggesting a solution that doesn’t solve the customer’s problem, but rather brings in more confusion. Microsoft’s Copilot (formerly Bing Chat) showed this when it responded with frustration after a user repeated questions. Instead of offering help, the chatbot pushed back and ended the conversation.

A third type of hallucination is when AI creates completely made-up content. These are the cases that really made it to the headlines. DPD’s chatbot , for instance, started to insult its own company and use inappropriate language during a support chat. It even called DPD “the worst delivery firm in the world.” Another example involved a lawyer who used ChatGPT to look up case law. The AI provided, confidently, full case names and citations—none of which were real.

These types of failures point out the risks of AI agents going off-track. Customer Care experts understand that when AI provides wrong or confusing information, it’s the business that gets the blame. When AI doesn’t stay focused on the issue, customer care teams often need to step in and solve the situation. The best way to avoid this is to catch hallucinations early through proper testing.

How Genezio solves AI hallucination problems in customer service

To avoid AI hallucination in customer service, it’s important to test the AI agents before they are fully deployed. Catching issues early helps businesses keep their customer experience compliant. Genezio makes this process simple, and offers a non-technical solution that anyone—from Customer Support Experts to business owners or developers—can use to check and monitor AI agents.

Genezio operates through real-world customer interactions simulations. This means putting AI agents through common scenarios they will face in customer service. With tools like LLM hallucination detection, Genezio checks AI responses against trusted sources, to make sure they’re accurate. It also flags inappropriate content, including biased or offensive replies, and checks for off-topic responses.

Additionally, with real-time monitoring, Genezio keeps an eye on AI performance after it’s deployed to make sure it always stays on track. For Customer Care Experts, this means you can count on accurate, reliable responses every time, without worrying about unexpected AI behavior.

Test and monitor your AI agents with Genezio today

As a Customer Care Expert, you know how important it is to keep a high standard of customer service. AI hallucination in customer service can seriously hurt the experience you’ve worked hard to build. That’s why it helps to have the right tools in place before things go off track.

With Genezio, you can easily test and monitor your AI agents to make sure they stay aligned with your business needs, and prevent mistakes that could harm your reputation. You don’t need to be technical to use it. Customer Care Experts can run checks, flag errors, and keep conversations on track without complex set-up. Genezio offers one-time audits or ongoing monitoring, so you can pick what fits your team.

And if you’d like to see how it works, you can book a demo or get a free report in just 24 hours.

Start using Genezio today to keep your customer service at its best and avoid potential risks. Try for free and see the difference it makes.