Insurance: a highly regulated sector
EIOPA welcomes the legislative proposal and supports the objectives and principles of the AI Act to promote the ethical and trustworthy use of AI.
However, the AI Act has the complex task of integrating provisions into existing sectoral regulatory frameworks. In the case of insurance, the sector is already highly regulated and the application of the AI Act is likely to give rise to some friction.
Indeed, when insurance undertakings and intermediaries use AI today, they do not do so in an unregulated space. There are legally binding instruments at international, European and national level that apply to the use of AI in the insurance sector. These include EU primary law, as well as EU secondary law such as the Insurance Distribution Directive, the Solvency II framework or the GDPR.
In addition, the insurance sector has certain specific characteristics that deserve particular attention within any cross-sectoral legislative proposal. For example, actuaries play an important role in the pricing and underwriting of insurance products that does not exist in other sectors. And certain data sets (for example relating to a person’s age or disability) that are not allowed to be used for pricing products in some sectors of the economy are allowed for insurance underwriting purposes.
EIOPA acknowledges the challenges arising from complex AI systems and the need to address them and it stands ready to develop further guidance. However, we strongly consider that this should be done by building on the existing sectoral governance, risk management, conduct of business and product oversight and governance requirements.