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Innovation and Technology at the NAIC 2019 Fall Meeting

Several NAIC groups continued addressing issues related to innovation in the life insurance industry as follows:

  • Privacy Protections Working Group – is determining whether the NAIC Insurance Information and Privacy Protection Model Act (#670) and the Privacy of Consumer Financial and Health Information Regulation (#672) need to be revised, as a result of the increased use of consumer data, to address any gaps in the current regulatory framework. Initially, the group compared the existing NAIC models against the California Consumer Privacy Act as an example. It also discussed insurers’ reliance on third parties and the insurers’ responsibility to ensure that third parties comply with applicable laws and use accurate data in their determinations.

  • Accelerated Underwriting Working Group – is obtaining information on, and is assessing issues that may arise out of, life insurers’ use of accelerated underwriting. It will evaluate the issues and determine whether it should draft guidance for the states.

  • Artificial Intelligence Working Group – is drafting guiding principles for the use of artificial intelligence in insurance for use by the various NAIC groups, state regulators, and the insurance industry. The draft principles, which are based on the OECD Principles on Artificial Intelligence that seek to promote innovation while protecting privacy and transparency and preventing discrimination, are being tailored for the insurance industry.

  • Big Data Working Group – concluded that regulators have adequate authority under existing insurance laws and regulations to review insurers’ use of data and algorithms, including as provided by third-party vendors. It discussed whether third-party vendors should be subject to regulatory authority through FCRA-like regulation or requiring that third-party vendors be licensed as advisory organizations.

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Ann Young Black Carlton Fields Business Transactions Financial Services Regulatory Government Law & Consulting Life, Annuity, and Retirement Litigation Life, Annuity, and Retirement Solutions Securities and Derivative Litigation Securities Transactions and Compliance
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Ann Young Black counsels financial services clients on a broad range of insurance, securities, and business issues. She regularly advises clients developing new and innovative life and annuity products and on the insurance and securities issues impacting those products. Ann also advises clients on the laws and regulations regarding the sale, distribution, issuance, administration and operation of, and benefit payment practices related to, these products. Clients also seek Ann's guidance on InsurTech initiatives, including the use of big data, artificial intelligence and machine learning,...

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Jamie Bigayer Insurance lawyer Carlton FIelds
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Jamie Bigayer counsels insurance and financial services companies on transactional, regulatory, and compliance matters arising under state insurance laws, federal and state securities laws, and related agency rules and regulations. Her practice focuses on the development and distribution of sophisticated financial products, including privately placed innovative fixed and variable life insurance and annuity products.

Jamie advises clients on a wide variety of issues including contractual issues, legal structure, disclosure requirements, sales and marketing practices, risk analysis, suitability, internal compliance policies and procedures, market conduct, licensing, and other compliance and regulatory issues affecting issuers and distributors of financial products.

Additionally, Jamie advises clients on the use of big data, artificial intelligence, and algorithmic models for accelerated underwriting, state data security and privacy laws, and the uniform electronic transactions act (UETA) and e-Signature requirements for implementing electronic transactions and document delivery.

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