The Oklahoma Insurance Department has released a bulletin informing agencies on how to best comply with state regulations using AI in their operations. The agency’s goal is to provide insurers with clear regulatory guidance on the ethical use of AI. Below are some questions to help consumers or those in the insurance industry seeking guidance on this issue.
Q: What are the main points highlighted in the Oklahoma Insurance Department’s AI Bulletin?
A: The bulletin highlights several key expectations for insurers using AI:
- Equity and Compliance: AI-based decisions must comply with all applicable insurance laws and regulations.
- Encourage innovation: The ministry supports the use of AI to improve the efficiency of the insurance sector, but also recognizes potential risks, such as inaccuracies or unfair discrimination.
- Transparency and accountability: Insurers must ensure that AI systems are transparent, with clear governance structures, control and accountability.
- Data protection: The bulletin also highlights the need to protect consumer data, recognizing the potential vulnerabilities associated with AI.
Q: What does Oklahoma Insurance Commissioner Glen Mulready say about balancing innovation and consumer protection?
A: Commissioner Mulready emphasizes that while the adoption of AI can help improve efficiency and the overall consumer experience, it is important to balance this innovation with strong consumer protection.
“New technologies come with a responsibility to ensure Oklahoma industry innovates while maintaining consumer protections,” Mulready said.
Q: How does the bulletin guide insurers in managing AI within their organizations?
A: The bulletin provides detailed guidance on how insurers should implement AI systems responsibly. This includes expectations for governance structures, accountability and ongoing staff training. Additionally, insurers are advised to maintain appropriate monitoring and auditing protocols for AI systems to ensure that they operate ethically and in compliance with regulations.
Q: What information does the Oklahoma Insurance Department expect insurers to provide regarding their AI systems?
A: Insurers will need to be prepared to provide detailed information about their AI systems upon request. This includes documentation of how AI is used, how its fairness is monitored, and what steps are taken to ensure the technology complies with state laws and regulations. The department aims to maintain transparency and ensure that AI does not lead to discriminatory or unfair practices.
Q: Are there any specific risks associated with the use of AI in insurance?
A: Yes, the bulletin recognizes several risks associated with AI, including potential inaccuracies in decision-making, the risk of unfair discrimination, and data vulnerability. The Oklahoma Insurance Department emphasizes the importance of using AI responsibly to mitigate these risks and protect consumers’ interests.
Q: Will AI lead to lower insurance premiums for Oklahoma consumers?
A: Although Commissioner Mulready does not foresee a major reduction in premiums thanks to AI, he believes the technology could help mitigate rising costs, mainly driven by inflation. By improving operational efficiency, AI could help insurance companies manage costs more effectively, which could have a positive impact on rates in the long term.
Q: What can insurance companies do to ensure they comply with the new AI guidelines?
A: Insurance companies are encouraged to carefully review the new bulletin and ensure that their AI systems comply with all relevant laws and regulations. The Oklahoma Department of Insurance is available to answer any questions insurers may have about the bulletin and its implementation, providing guidance on how to align their use of AI with the expectations outlined .
Q: Where can people find more information about the bulletin and its guidelines?
A: The full Bulletin 2024-11, along with all guidelines and expectations regarding the use of AI in the insurance industry, is available on the Oklahoma Insurance Department website at oid.ok.gov/bulletins.
