A Florida House subcommittee this week approved a bill that would mandate human involvement in p
roperty insurance claims denials, a sign of the times as insurers employ more artificial intelligence on multiple fronts.
House Bill 527 is sponsored by state Rep. Hillary Cassel, a policyholder attorney and the vice chair of the House Commerce Committee’s instrumental
Insurance and Banking Subcommittee. It would require carriers to inden
the decision to deny the claim or a portion of the claim.”
The bill, which passed the subcommittee Tuesday, also wo
uld make insurers include a statement that AI, algorithms or machine learning were not the sole basis for denying the clam.
“An insurer that uses an algorithm, an artificial intelligence sys
tem, or a machine learning system as part of its claims-handling process shall detail in its claims-handling manual th
e manner in which such systems are to be used and the manner in which the insurer complies with this section,” the bill reads.
Thomas Koval, on behalf of Florida Insurance Council, at the meeting (Florida Channel)
Cassel said the bi
ll was prompted in part by the 2024 shooting of UnitedHealthcare CE
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O Brian Thompson one year ago in New York. Reports have suggested that when AI was used to deny United’s claim
s, most of the denials had errors, Cassel said, according to Florida Politics news site and a recording of the subcommittee meeting.
Insurance interests noted that AI now plays an important role in c
laims management. Robert Passmore, with the American Property
and Casualty Insurance Association, said at the subcommittee meeting that limits on AI could slow the claims pr
ocess, and that artificial intelligence can actually help reduce errors, the news site reported.
The bill has a way to go if it is to become law, including more Hou
se and Senate committees and floor votes. A Senate version of the bill i
s SB 202. The full Florida Legislature convenes Jan. 13 for its 60-day session.