Close Close

Life Health > Life Insurance

Center Asks NAIC to Look for Racial Bias in Life Insurers' Methods

Your article was successfully shared with the contacts you provided.

The Center for Economic Justice says that, if state insurance regulators are serious about fighting systemic racial bias, they should take a close look at  new life insurance underwriting strategies.

The center is calling for regulators to verify that the new data sources, data analysis rule sets, and “artificial intelligence” programming techniques are fair to black people.

Regulators should also verify that the new underwriting strategies are fair to members of other classes of people who, under federal law, are supposed to be protected against unfair discrimination, the center says in a new comment letter.


  • A copy of the Center for Economic Justice comment is available here.
  • An article about the American Council of Life Insurers’ efforts is available here.

The center has sent the letter to five panels at the National Association of Insurance Commissioners, including the Accelerated Underwriting Working Group.

The working group is part of the NAIC’s Life Insurance and Annuities Committee.

The NAIC has made Birny Birnbaum, the executive director of the Center for Economic Justice, one of the people who has an official role in speaking up for consumers’ interests in NAIC proceedings.

Birnbaum and the Center for Economic Justice have talked often about the need for regulators to review new insurance technology for signs of unfair bias.

The center says in the new comment letter that it’s making the point again, now, because of what insurance industry leaders have been saying about the need to respond in meaningful ways to the death of George Floyd.

In the past, the center says, “Insurers have consistently opposed proposals to address systemic bias and inherent racism in insurance.”

Some of the strategies that could lead to unfair bias include using employment categories and education levels in marketing and underwriting, using facial analytics in life insurance underwriting, and taking credit scores into account for pricing coverage and administering anti-fraud programs, the center says.

Regulators have imposed some anti-discrimination rules on P&C insurers’ use of statistical analysis for predicting consumers’ behavior, but “there are no similar regulatory requirements for life insurers,” the center says.

Life insurers are in need of attention because of their ”non-traditional, non-insurance data and complex algorithms,” the center says.

Insurers and regulators should “match their statements of outrage over systemic racism with the actions needed to identify and minimize such unfair discrimination,” the center says.

— Read ‘We Can All Do More’: American College President, on ThinkAdvisor.

— Connect with ThinkAdvisor Life/Health on FacebookLinkedIn and Twitter.