Is your Underwriting AI following the regulations?

AI is supposed to make things ‘easier’ and ‘better.’ And to some extent it is. 

But every industry has its own lingo, rules, and complications. Is AI smart enough to understand and follow everything to the dot? Maybe. 

Maybe? That’s not acceptable in an industry like insurance that deals with sensitive information and human lives. 

So, if AI misses, misunderstands, or overlooks a clause, the fallout will be legal, reputational, and quite expensive. 

This is where the rubber meets the road, and “the chatbot was glitching” can’t be an excuse; your team has to be super cautious. 

How has AI made Underwriting riskier? 

There’s no doubt that AI has changed the definition of underwriting as we know it by gifting it its speed. The process that used to take weeks now gets done in hours. 

There are several underwriting tools that promise your team and customers fast decisions, but fail to provide a reason. That’s bias, and it’s highly criticized in the industry. 

For example, if the model your team is trained on data from salaried applicants, by default, it would reject freelancers and mark them ‘high-risk’, disregarding correct data. This would not only cost your company an opportunity, but it would also destroy your credibility. 

Deloitte has already warned companies using AI that, while optimization is the goal, accountability, transparency, and bias mitigation remain non-negotiables in the healthcare industry. 

Regulations AI tools should follow in 2025

As the use of AI is becoming a norm in insurance underwriting, global regulators like NAIC in the U.S., the EIOPA in the EU, and the IRDAI want to ensure that fairness and inclusivity prevail. That’s why they only want AI tools that can withstand public and legal scrutiny. 

Here are the four pillars of compliance for AI tools to follow: 

Explainability 

If your team can’t provide a reason for the question, then you may have to deal with a lawsuit.

U.S NAIC has highlighted that “transparency and explainability” isn’t optional. If the AI tool can’t explain the ‘why,’ then it doesn’t belong in underwriting. 

In fact, “72% of insurance executives believe current regulatory uncertainty around AI explainability is significantly slowing their adoption timeline.” 

Fairness

Regulators know your team doesn’t intentionally introduce bias to your tool, but it’s your responsibility to check that it doesn’t creep in there. 

Something as simple as using a zip code or past claim history could be flagged as biased. That’s why states like Colorado now need insurers to prove that their AI tools are not being unfair or biased towards protected groups. 

Underwrite.In protects your company from such mess-ups by providing 3x more accuracy than other AI underwriting tools. 

But why choose Underwrite.In?

At Underwrite.In, we follow a no-nonsense process. 

That’s why we have a team that brings over two decades of experience, and we have already processed 10,000+ applications without any complaints. 

Our secret? None. 

We have built sophisticated risk-assessment models with the help of industry experts. 

And along with unmatchable accuracy, Underwrite.In also increases the processing time to 85% and reduces cost by 60%.

So, get Underwrite.In 

Accountability 

If AI messed up, it won’t be answerable to anyone. It will neither face the lawsuit nor help you defend your case. 

That’s why regulators expect insurance companies to put human checks in place and have clear instructions to fix a bad AI outcome. India’s IRDAI is especially pushing for this. 

But hiring an expert for every step of the underwriting process will be expensive. So, that’s again when you reach out to Underwrite.In. 

Data Governance

The answer to this can’t be no. 

The EU’s AI Act and EIOPA guidelines have made it clear that every bit of data that your AI tool uses to make a decision should be traceable and relevant. 

Do you want to run a company without these fears? 

Underwrite.In is ready to take away all these headaches from you. We believe that innovation and ethics go hand-in-hand.

Our AI-powered platform is built with a commitment to fairness, transparency, and data privacy, ensuring that you can revolutionize your underwriting process while upholding the highest ethical standards. 

We are dedicated to mitigating biases, safeguarding sensitive information, and providing clear insights into how data drives decisions.

Because we understand, in an industry built on trust, tech issues can’t be an excuse. 

Team Underwrite.In