At BriteCore, we see AI as a powerful tool to help carriers serve their policyholders more efficiently and accurately. But with this power comes responsibility. The recently adopted NAIC Model AI Bulletin (December 2023) provides a clear framework for how insurers should approach AI: with fairness, accountability, and transparency at the forefront.

Why Responsible AI Matters

AI enables innovation, improves customer experience, and streamlines operations. Yet it also introduces risks such as bias, lack of explainability, and potential unfair discrimination. The NAIC emphasizes that decisions supported by AI must comply with all applicable insurance laws and regulations, including those that prohibit unfair trade practices and discrimination. Responsible AI use isn’t just good ethics—it’s regulatory compliance.

Governance and Accountability

The Bulletin underscores the importance of robust governance. Insurers are expected to create a formal AI Systems (AIS) Program to oversee development, acquisition, and deployment of AI technologies. This program should include:

• Senior leadership accountability with clear reporting structures.
  
• Policies and controls to manage risks throughout the AI system’s life cycle—from design and validation to monitoring and retirement.
  
• Internal audits and documentation to demonstrate compliance during regulatory reviews.
  

At BriteCore, we share this philosophy. Our modern insurance policy administration system is designed with configurable governance and audit trails that give carriers visibility into decisions, models, and outcomes.

Risk Management and Fairness

The Bulletin highlights the need to proactively address risks such as model drift, bias, and data integrity. Insurers are encouraged to:

• Validate and test predictive models regularly.
  
• Ensure data quality, integrity, and suitability.
  
• Document processes to detect and mitigate unfair discrimination.
  

BriteCore supports this by enabling carriers to manage their models with transparency, helping ensure that decisions remain consistent, explainable, and fair.

Working with Third Parties

Insurers often rely on external vendors for AI solutions. The NAIC advises carriers to perform due diligence on third-party providers and include audit rights and compliance terms in contracts. BriteCore’s open API ecosystem and integration marketplace make it easier for carriers to evaluate, manage, and monitor third-party tools responsibly.

Our Commitment

At BriteCore, we believe AI must empower—not endanger—policyholders. By aligning with the NAIC’s principles of fairness, accountability, compliance, and transparency, we ensure that innovation and integrity go hand in hand.

The insurance industry is at an inflection point. Carriers that embrace responsible AI will not only meet regulatory expectations but also build the trust and loyalty of their policyholders for years to come.