NAIC | December 06, 2023
The National Association of Insurance Commissioners (NAIC) Membership voted to adopt the Model Bulletin on the Use of Artificial Intelligence Systems by Insurers during the 2023 Fall National Meeting.
The bulletin reflects the work of the NAIC Innovation, Cybersecurity, and Technology (H) Committee, chaired by Maryland Insurance Commissioner Kathleen A. Birrane. Michael Conway, Commissioner of the Colorado Division of Insurance, and Doug Ommen, Commissioner of the Iowa Insurance Division, are co-vice chairs of the committee.
"This initiative represents a collaborative effort to set clear expectations for state Departments of Insurance regarding the utilization of AI by insurance companies, balancing the potential for innovation with the imperative to address unique risks,"
said Commissioner Birrane.
As the insurance sector navigates the complexities of AI, the NAIC's Model Bulletin on the Use of Artificial Intelligence Systems by Insurers provides a robust foundation to safeguard consumers, promote fairness, and uphold the highest standards of integrity within the industry.
[Source -PR Newswire]
The H Committee, comprised of representatives from 15 states, began drafting the bulletin in 2023 with the goal of establishing comprehensive regulatory standards to ensure the responsible deployment of AI in the insurance industry. The bulletin addresses critical issues related to the usage of AI, such as potential inaccuracies, unfair biases leading to discrimination, and data vulnerabilities.
While not a model law or regulation, the AI model bulletin serves as a guiding document, fostering uniformity among state insurance regulators regarding expectations for insurance carriers deploying AI. The bulletin comprises four key sections, each addressing crucial aspects of AI usage by insurers. It emphasizes the importance of responsible governance, risk management policies, and procedures to ensure fair and accurate outcomes for consumers.
The bulletin reminds insurance carriers that decisions impacting consumers that are made or supported by advanced analytical and computational technologies, including AI, must comply with all applicable insurance laws and regulations, including unfair trade practices. The bulletin also sets forth state insurance regulators' expectations on how insurers should govern the use of such technologies by or on behalf of the insurer to make or support such decisions, including the creation and implementation of a written AIS Program, commensurate with an assessment of the risk in accordance with the guidelines established by the NAIC's 2020 Principles of Artificial Intelligence, and to ensure that decisions impacting consumers made or supported by AI are accurate and do not violate unfair trade practice laws or other applicable legal standards. The bulletin also advises insurers of documentation that a state Department of Insurance may request during an investigation or examination.
The initial draft was presented to the working group on June 29, 2023, and subsequently exposed for public comment periods, allowing for extensive input from industry stakeholders, consumers, and legislators. The process involved two exposure periods, with the first public comment period ending on Sept. 5, 2023, and the second ending on Nov. 6, 2023. The review process also included in-person comments during the 2023 Summer National Meeting in Seattle, WA, and during the 2023 Fall National Meeting in Orlando, FL.
Significant updates were made to the model bulletin based on the feedback received. These updates addressed concerns raised during the review process, including a shift in focus toward outcomes, revisions to key definitions aligned with National Institute for Standards and Technology (NIST) standards, and updates to language on third-party contracting and testing and validation protocols.
Commissioner Birrane expressed gratitude for the collaborative efforts of the H Committee, drafting groups, and all stakeholders involved. The completion and adoption of the model bulletin mark a significant step forward in adapting regulatory frameworks to the evolving landscape of AI in the insurance industry.
About the National Association of Insurance Commissioners
As part of our state-based system of insurance regulation in the United States, the National Association of Insurance Commissioners (NAIC) provides expertise, data, and analysis for insurance commissioners to effectively regulate the industry and protect consumers. The U.S. standard-setting organization is governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer reviews, and coordinate regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally.
Business Wire | October 17, 2023
Hourly.io, a fast-growing workers’ compensation and payroll startup, has selected Origami Risk’s multi-tenant Software-as-a-Service (SaaS) P/C core solution to bring critical automation to its breakthrough insurance platform for small and mid-sized businesses with hourly and mobile workers.
Hourly will use Origami’s API to instantly quote policies. The platform integrates rates and rules from NCCI and other bureaus with Hourly’s underwriting models. Hourly combines payroll with time and attendance data to determine workers’ compensation premiums with to-the-penny accuracy in real time. The rating information will be instantly applied to applications submitted by insurance agents and brokers through Hourly’s instant quote portal.
As we continue our rapid growth across the United States, choosing and deploying the best available technology has enabled us to drive down costs and streamline the rate-to-bind process for small and mid-sized employers, said Tom Sagi, Co-Founder and CEO, Hourly. Origami’s solution seamlessly integrates with our platform so we can scale while maintaining our speed, efficiency and accuracy.
“Our automated solution aligns perfectly with Hourly’s objectives and the needs of its distribution network and clients,” said Christopher Bennett, Chief Strategy Officer, Core Solutions division at Origami Risk. “This proprietary capability is among several innovative solution sets we’ve developed to help carriers, pools, program administrators and other insurance providers drive efficiencies across critical functions, meet customer needs and improve overall performance.”
Origami Risk offers a full suite of end-to-end, integrated SaaS solutions for policy, rating, billing, loss control and claims administration, reporting and analytics, along with a comprehensive digital engagement experience for all internal and external stakeholders.
Established in 2018, Hourly offers workers’ comp insurance and an integrated platform that connects workers’ comp, time tracking, and payroll in real time—an innovation that ensures premiums are calculated with unprecedented precision. Hourly is first of its kind in the industry to bridge this gap seamlessly with a mobile-first platform.
Headquartered in Palo Alto, California, Hourly.io is an insurtech startup offering full-service payroll and workers' comp insurance for small and medium businesses with hourly workers. Powered by real-time data, Hourly's platform ensures running payroll is as quick as pressing a button and that you get accurate workers' comp premiums down to the penny. For more information, visit www.hourly.io.
About Origami Risk – Core Solutions Division
Origami Risk provides integrated SaaS solutions that simplify insurance, risk, and safety for insurers, managing general agents (MGAs), program administrators, third party claims administrators (TPAs), risk pools, brokers and more. Origami Risk delivers its highly configurable and completely scalable integrated insurance core system, risk management and safety solutions from a secure, multi-tenant platform accessible via web browser and mobile app. Visit origamirisk.com or contact Origami at email@example.com.
PR Newswire | September 14, 2023
Cowbell, a leading provider of cyber insurance for small- and medium-sized enterprises (SMEs), today announced its partnership with Zywave, an industry-leading provider of insurtech solutions. The partnership is powered by Herald, a digital infrastructure provider that connects software developers to commercial insurance carriers through a single API, and leverages Cowbell's leading technology and individualized coverage options for a superior customer experience through Zywave's expanding, simple and efficient, API-first interface for quoting commercial and E&S insurance. The collaboration marks the first standalone cyber insurance offering on Zywave's Hub, which provides MGAs, wholesale brokers, and retailers, with quicker access to modernized cyber insurance products.
Despite cyber being the fastest-growing line of insurance business in recent history, four out of five SMEs are still uninsured or underinsured, according to a recent report published by the small business resource AdvisorSmith. By partnering with Zywave, Cowbell extends its reach within MGAs and brokers and helps further accelerate the adoption of cyber insurance within the SME market.
"As the first cyber insurance provider on Zywave's Hub via Herald's API, our adaptive programs are now available to over 40 additional trading partners," said Rajeev Gupta, co-founder and CPO of Cowbell. "These partners can now experience the simplicity of placing the industry's best cyber insurance coverage for their clients and protecting their clients' future cyber risks with Cowbell's tailored risk mitigation service."
"This is an exceptionally powerful partnership between the most innovative leaders in the industry," said Duncan Crystal, co-founder and CRO at Herald. "Together, we're proving how API-driven distribution can transform an industry that has traditionally run on paper. Our unified offering makes it easier for carrier partners to plug into networks of brokerages and MGAs, resulting in more premium for all players in the value chain, along with better coverage for businesses."
The ability to adapt to ever-changing market conditions in almost real-time allows capacity providers like Cowbell to expand or contract the markets they serve without being hindered by manual processes and antiquated technology. Expanding Zywave's offerings through Cowbell's advanced technology and quality insurance programs ushers in a new and improved way for brokers to sell cyber insurance to their clients.
Cowbell is a pioneer of Adaptive Cyber Insurance, a leader in providing small and medium-sized enterprises (SMEs) coverage adaptable to today's and tomorrow's threats and the advanced warning of cyber risk exposures. In its unique AI-based approach in risk selection and pricing, Cowbell's continuous underwriting platform, powered by Cowbell Factors, compresses the insurance process from submission to issue in less than 5 minutes. Cowbell is backed by 20 prominent leading global (re)insurance partners and serves SMEs in 50 U.S. states, the District of Columbia and the United Kingdom. Founded in 2019, Cowbell is based in the San Francisco Bay Area with employees across the U.S., Canada, India, and the U.K. For more information, please visit https://cowbell.insure/.
Herald builds digital infrastructure for commercial insurance. Developers who use Herald quote and bind insurance from multiple carriers through a single API. For more information, visit https://heraldapi.com.
Zywave leads the insurtech industry, fueling business growth for its partners with cloud-based sales management, client delivery, content, and analytics solutions. Zywave's all-in-one platform provides customizable, user-friendly options that enable insurance professionals to build a unique solution to fit their specific growth goals—their own Modern RevOps Machine. More than 15,000 insurers, agencies, and brokerages worldwide—including all of the top 100 U.S. insurance brokerages—use Zywave solutions to enhance client services, achieve business growth and promote greater health, wellness, risk management, and safety. Additional information can be found at www.zywave.com.