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NAIC launches AI evaluation tool pilot across 12 states to improve insurer oversight
The NAIC launched a pilot in 12 states to help regulators review how insurers use AI, running through September. The tool covers market conduct, financial analysis, and all major insurance lines.
NAIC launches AI evaluation tool pilot across 12 states
The National Association of Insurance Commissioners has started a pilot program to help regulators monitor how insurers use artificial intelligence. The pilot runs through September across California, Colorado, Connecticut, Florida, Iowa, Louisiana, Maryland, Pennsylvania, Rhode Island, Vermont, Virginia, and Wisconsin.
The AI Evaluation Tool gives states a structured method to review AI systems, check transparency, and spot where insurers need better oversight or training. Each participating state will develop a project summary and report progress at monthly meetings.
What the pilot covers
States will use the tool across market conduct exams, financial analysis, and financial exams. Regulators will observe insurers across property and casualty, life, and health insurance lines.
The pilot tests whether the tool helps insurers explain their AI governance to regulators more clearly. It also aims to shape long-term recommendations for how states should review market conduct and financial risk.
Implementation will vary by state. Regulators can adapt questions to fit their jurisdiction's needs.
Timeline and next steps
States must explain the tool's purpose to each insurance company they examine. The NAIC plans to update the tool based on feedback and reissue it in September or October for review at the fall national meeting.
The NAIC's Big Data and Artificial Intelligence Workgroup is also monitoring state, federal, and international AI regulatory developments. As of early March, 25 states have adopted the NAIC's Model Bulletin on the Use of AI Systems by Insurers.
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