Regulators scrutinize insurers' use of AI and data mining tools as potential for discrimination emerges

Insurance companies are increasingly adopting next-generation technology and data mining tools to improve risk management, revenue growth and profitability. However, the increased use of external consumer data sets and AI and ML-enabled analytical models presents challenges of unintended bias against protected classes of people. Regulators in the US, UK and Europe are responding to these challenges by penning new policies and legal frameworks to prevent AI model-driven consumer bias and impose accountability on insurers. The Colorado Division of Insurance has issued a draft regulation to prohibit life insurers from using ECDIS in a discriminatory manner. These regulations can present significant execution challenges for insurers, who must balance compliance and profitability. Leading companies may opt to partner with experts to address the operational challenges of evolving data privacy and model ethics regulations. Read more >>> Ethical Use of AI in Insurance Modeling and Decision-Making - Lexology