AM Best is reporting that the Colorado Division of Insurance is adopting new guidelines for how insurers use external consumer data and information sources – dubbed ECDIS – in order to prevent discrimination caused by emerging technologies.

Insurers using ECDIS and predictive models that rely on outside information sources after November 14 this year have until June 1, 2024 to submit a report to the division outlining progress made toward compliance. “After that, companies using ECDIS, as well as algorithms or predictive models based on ECDIS will need to submit a written report annually on December 1 outlining compliance and the title and qualifications of those responsible for doing so,” AM Best writes in its note, Colorado Adopts Regulation Aiming to Curb Racial Discrimination in Life Insurer Use of Outside Data.

“Life insurers that use ECDIS, as well as algorithms and predictive models that use ECDIS in any insurance practice, must establish a risk-based governance and risk management framework that facilitates and supports policies, procedures, systems and controls designed to determine whether the use of such ECDIS, algorithms and predictive models potentially result in unfair discrimination with respect to race and remediate unfair discrimination, if detected.”