In the P&C Specialist article, “Regulators Investigate Insurers for Bias as Tech Adoption Ramps Up,” the publication reported how the use of Artificial Intelligence (AI), machine learning and algorithmic decision-making tools by insurers is on the rise, while at the same time some regulators, policymakers and other stakeholders have questioned whether protected classes of people will be subject to bias when accessing insurance products.
The publication turned to artificial intelligence and algorithmic decision-making (AI-X) team co-leader and insurance partner Scott Kosnoff for insight on the matter.
Kosnoff noted that they have yet to see instances of harm owing to the use of technology. “We aren’t aware of any insurance consumers being harmed as result of AI or algorithmic decision-making,” he said. “But as a practical matter, insurers that use these tools face regulatory, litigation and reputational risk.”
He also shared that the best way to manage the legislative, regulatory and reputational risks that come from the use of AI is to stay up to speed with the evolving regulatory expectations and have a risk management framework in place.
“Organizations should strive to have a good story to tell regulators, courts, journalists and others,” Kosnoff explained. “The story should demonstrate that the organization understands the concerns that have been expressed about AI, takes the concerns seriously and is trying to identify, manage and mitigate the possibility of negative outcomes.”
The full article is available for P&C Specialist subscribers.