In today’s fast-paced AI landscape, insurers are pressured to innovate rapidly or risk being outpaced. Those of us who have been in the industry for a while understand that innovation requires a careful balance. We’ve seen this challenge emerge in various conversations at conferences in the US and UK. Several industry friends and colleagues said they are “waiting for the regulatory landscape to become clearer” before adopting AI.

Navigating Vague Regulatory Guidelines

It seems that the approach could negatively impact productivity in the long run. Thus, while the tech industry’s motto may be “move fast or get left behind,” regulated industries must move forward with caution and certainty. 

National Association of Insurance Commissioners (NAIC) guidelines in the U.S. are like the EU’s GDPR, which, after nearly a decade, still raises questions due to its lack of clarity. This deliberate ambiguity allows regulators to evolve guidelines over time as they respond to the market and technology shifts. 

This vagueness adds complexity for those of us deploying artificial intelligence. Unlike the software industry, where insurers often release updates quickly and iterate as needed, AI system innovations must withstand regulatory scrutiny and be transparent to the public. The stakes are high: if an insurer needs to modify or retract a decision, it must communicate these changes widely. 

Striking a Balanced Approach

Many voices emphasize the urgency of innovation—stressing the risk of becoming obsolete if the industry doesn’t adapt quickly. However, as we interact with regulators, we gain a different perspective. Regulators urge a more careful, measured approach. They recognize the importance of understanding long-term impacts before issuing public opinions and welcome diverse perspectives in decision-making.

Engaging with regulators is a valuable opportunity to understand their concerns and communicate these to our customers. By fostering dialogue, we can help insurers navigate the dual pressures they face: the need for agility and the demand for thoughtful action. Partnering with us allows our colleagues to make informed, calculated decisions that minimize risk but align with evolving regulatory requirements, ultimately building sustainable and impactful AI systems.

Moving Forward

OverseeAI is about building partnerships beyond technology, fostering sustainable value, responsibly navigating regulatory landscapes, and driving meaningful innovation that stands the test of time. If you want to discuss the regulatory environment and how our platform can help, contact us today.