The Washington State Office of the Insurance Commissioner published a Bulletin after adopting the NAIC's model on the use of artificial intelligence systems by insurers. The Washington bulletin is applicable to all insurers licensed to do business in the state.
The Bulletin reminds insurers that actions or decisions affecting insureds made by AI and AI systems must comply with Washington law and regulations, including the following:
The Unfair Trade Practices Act, Chapter 48.30 RCW prohibits unfair methods of competition or unfair or deceptive acts.
The Unfair Claims Settlement Practices Act sets standards for the investigation and disposition of insurance claims for residents of Washington.
RCW 48.18.940 prohibits unfair discrimination between insureds having substantially similar risk and exposure factors.
The Property and Casualty Model Rating Law, RCW 48.19.020 requires that insurance rates not be excessive, inadequate, or unfairly discriminatory.
These laws apply to AI and AI systems. Insurers should ensure the use of such systems do not violate the principles of the unfair discrimination laws, and rates developed using AI systems should not be in violation of the rating laws.
Insurers are expected to develop and implement a written AIS Program for the responsible use of AI Systems. The bulletin outlines a series of general guidelines for AIS programs that includes addressing governance, risk management controls, audit functions, how AI is used with the Enterprise Risk Management System, how the AIS will address all phases of the system's life cycle, and others.
A more extensive discussion of the NAIC model template can be found here: NAIC Model Bulletin: Use of Artificial Intelligence Systems by Insurers.
The Washington bulletin can be found here.