Happy Wednesday! In this week's Big I Buzz: The Big "I" and ACT provide a memo and sample policy on AI. Plus, the 2024 Insurance Fraud Hall of Shame.

Big ‘I’ and ACT Provide Memo, Sample Policy on AI

The promise of artificial intelligence (AI) is compelling. Agencies have access to newly available automated products or services that could make them more efficient, effective and profitable. However, there are important legal issues related to AI that Big “I" members should consider.

For example, like any other third-party vendor that handles data, AI raises potential data privacy and security risks that may—or may not—be addressed in the vendor's contractual terms. Agencies should also guard against risks relating to the accuracy of AI outputs, as well as intellectual property infringement and ownership issues.

Agencies should also watch out for new contractual restrictions imposed by carriers around AI usage, as well as regulatory compliance issues. Colorado recently became one of the first states to enact a comprehensive law regulating the use of AI in “high risk" systems that make “consequential decisions" in certain sectors, including insurance.

While the Colorado AI Act does not go into effect until February 2026, agents should consider proactively addressing AI usage with their staff. The Big “I" Office of General Counsel and ACT have published a memo on the legal issues relating to AI usage and a sample acceptable-use policy that members can customize for their business. The sample can be found at the end of the memo on legal risks, which is available on the Big “I" Legal Advocacy webpage.

The 2024 Insurance Fraud Hall of Shame

Insurance fraud comes in all shapes and sizes, and some cases are truly head-scratching. PropertyCasualty360’s 2024 Insurance Fraud Hall of Shame highlights some of the wildest schemes from the past year. View the list here.

Happy Holidays from the IIAW

Our office will be closed December 24, 25, 31 and January 1 for the holidays. This will be the final edition of the Big I Buzz of 2024. We'll return with fresh updates on January 8! In the meantime, stay connected with us on Facebook and LinkedIn. We'll see you in the New Year!

For more news, check out the Action News section of our weekly e-newsletter, Big I Buzz. If you aren’t subscribed, click here to add your email to our emailing list.