From September 2019 to June 2021, EIOPA set up a Consultative Expert Group on Digital Ethics in Insurance (GDE), to which BETTER FINANCE contributed, with the aim of providing an overarching framework to AI governance in light of recent international and European developments in the digitalisation of financial services, and for the insurance sector in particular. The outcomes are published in the report “Artificial Intelligence Governance Principles: Towards Ethical and Trustworthy Artificial Intelligence in the European Insurance Sector”.
With this report, EIOPA has adopted a multi-stakeholder approach to address the complex innovations in the insurance market and its rapid evolution linked to digitalisation, in particular through artificial intelligence (AI). Whereas benefits can stem from AI in terms of prediction accuracy, automation, new products and services, and cost reductions, experts convened by EIOPA advised on limits and risks associated in terms of critical market practices such as pricing, automation, fairness and non-discrimination.
To better ensure fairness and good consumer outcomes, the report establishes principles and standards that should be followed by the industry, with a dedicated focus on IA-processed impact assessment and data governance. Transparency, human oversight and robustness are therefore also promoted and analysed as essential elements of a robust AI governance framework for a well-functioning, trusted and financially inclusive insurance sector.
BETTER FINANCE joins EIOPA in welcoming the findings of all experts involved and considers this report as an important stepping stone to better define an appropriate standardised use of AI in insurance, both in terms of ethics as regards industry practices as well as for future regulatory frameworks.