Requires automobile insurers using automated or predictive underwriting systems to annually provide the Department of Banking and Insurance with documentation demonstrating no discriminatory outcomes in pricing based on race, ethnicity, sexual orientation, or religion. Mandates insurers to show that each pricing segment is balanced and not disproportionate to the overall policyholder population. Defines automated or predictive underwriting system as a computer-generated process, including robotic process automation, artificial intelligence, or other specialized technology, used to evaluate risk and determine insurance rates. Authorizes the Commissioner of Banking and Insurance to adopt rules and regulations to implement the act. Specifies that the act takes effect six months after enactment and applies to all automobile insurance policies issued or renewed thereafter.
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New Jersey Bill A537 ("Discrimination in Automobile Insurance")
ETO AGORA · U.S. state and local documents · 2022
Summary
Requires automobile insurers using automated or predictive underwriting systems to annually provide the Department of Banking and Insurance with documentation demonstrating no discriminatory outcomes in pricing based on race, ethnicity, sexual orientation, or religion.
Mandates insurers to show that each pricing segment is balanced and not disproportionate to the overall policyholder population.
Defines automated or predictive underwriting system as a computer-generated process, including robotic process automation, artificial intelligence, or other specialized technology, used to evaluate risk and determine insurance rates.
Authorizes the Commissioner of Banking and Insurance to adopt rules and regulations to implement the act.
Specifies that the act takes effect six months after enactment and applies to all automobile insurance policies issued or renewed thereafter.
Requires automobile insurers using artificial intelligence or other automated underwriting systems to annually provide analyses showing nondiscriminatory pricing outcomes and proportionate risk segmentation to state regulators.
AN ACT concerning discrimination in automobile insurance underwriting and supplementing P.L.1997, c.151. (C.17:29A3 46.1 et al.).
BE IT ENACTED by the Senate and General Assembly of the State of New Jersey:
a. An automobile insurer using an automated or predictive underwriting system shall annually provide documentation and analysis to the Department of Banking and Insurance to demonstrate that there is no discriminatory outcome in the pricing on the basis of race, ethnicity, sexual orientation, or religion, that is determined by the use of the insurer’s automated or predictive underwriting system. Additionally, an insurer shall demonstrate to the commissioner that each pricing segment is balanced and not disproportionate to the overall policyholder population. b. As used in this act, “automated or predictive underwriting system” means a computer-generated process that is used to evaluate the risk of a policyholder and determine an insurance rate. An automated or predictive underwriting system may include, but is not limited to, the use of robotic process automation, artificial intelligence, or other specialized technology in its underwriting process.
Directs the Commissioner of Banking and Insurance to adopt rules and regulations under the Administrative Procedure Act to implement oversight.
- The Commissioner of Banking and Insurance shall adopt rules and regulations pursuant to the “Administrative procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), to effectuate the purposes of this act.
Takes effect six months post-enactment; applies to new or renewed auto insurance policies thereafter. Permits the Commissioner of Banking and Insurance to take necessary administrative actions to facilitate the act.
- This act shall take effect on the first day of the sixth month next following enactment and shall apply to automobile insurance policies initiated or renewed on or after that date. The Commissioner of Banking and Insurance may take any anticipatory administrative action in advance as shall be necessary for the implementation of this act.