AI governance for Massachusetts insurers
The Massachusetts Division of Insurance issued Bulletin 2024-10 on December 9, 2024, adopting the NAIC Model Bulletin on the Use of AI Systems by Insurers. It reminds insurers that any decision or action impacting consumers must comply with Massachusetts insurance law, including the laws on unfair trade practices and unfair discrimination, regardless of the methods used to make the decision. The Division recognizes the NAIC's 2020 Principles on Artificial Intelligence as an appropriate source of guidance and expects each insurer to maintain a written AIS Program covering the full insurance life cycle. The Division states it will revisit the guidance periodically and consider recommendations from the Artificial Intelligence Task Force created under Executive Order Number 629.
What Massachusetts expects from your AIS Program
Massachusetts adopted the NAIC model verbatim, so the program expectations match the national framework.
Governance
A written program with clear ownership. Senior management is accountable to the board, and a cross-functional body oversees AI across its whole life cycle.
Risk Management & Internal Controls
Controls at every stage of the model life cycle, from data sourcing through retirement, sized to the potential harm to consumers.
Third-Party AI Systems & Data
The insurer stays responsible for AI it did not build. Vendor relationships need diligence, contract rights, and the ability to produce evidence.
Documentation & Audit-Readiness
Section 4 spells out what an examiner can ask for. Treating that list as a standing requirement is what keeps a program defensible.
Legal authority
The Massachusetts Division of Insurance grounds the bulletin in laws it already enforces:
- Unfair Methods of Competition and Unfair and Deceptive Acts and Practices in the Business of InsuranceM.G.L. c. 176D
- Regulation of Rates for Certain Casualty InsuranceM.G.L. c. 175A
- Corporate Governance Annual DisclosureM.G.L. c. 176W
Who it applies to
The bulletin reaches every entity holding a Massachusetts certificate of authority, including:
- Property and casualty insurers
- Life and annuity insurers
- Health insurers, HMOs, and medical service corporations
- All other entities licensed to do business in Massachusetts under M.G.L. c. 175, 176, 176A through 176H, and 176P
State-specific changes: Massachusetts tracks the NAIC model closely and keeps the model's optional language allowing an AIS Program to rely on a recognized framework such as the NIST AI Risk Management Framework, Version 1.0. The one local note is that the Division will weigh recommendations from the state's Artificial Intelligence Task Force when it updates the guidance.
Resources for Massachusetts insurers
Start with these plain-language explainers and field guides.
What is the NAIC Model Bulletin on AI?
The NAIC Model Bulletin on the Use of AI Systems by Insurers is the template most states use to set AI governance expectations. Here is what it says and why it matters.
GuideWhat is an AIS Program?
An AI Systems Program (AIS Program) is the written program the NAIC Model Bulletin expects every insurer to maintain. Here are its four pillars and what each one requires.
GuideWhat are the NAIC AI Principles?
The NAIC AI Principles, adopted in 2020, are the foundation beneath every state AI bulletin. The five principles spell FACTS: Fair, Accountable, Compliant, Transparent, and Secure.
GuideAI in Insurance: Key Regulatory Definitions
The NAIC Model Bulletin defines the terms that carry legal weight, from AI System to Adverse Consumer Outcome to Model Drift. Here is what each one means for insurers.
ArticleInsurance Regulators Are Forcing AI Governance. Most Carriers Aren't Ready.
State insurance regulators and bar associations are sounding the alarm on AI in insurance. Legal and regulatory pressure is forcing insurers to operationalize AI governance, not just document it.
ArticleThe NAIC Bulletin Is the Floor Your Reinsurer Will Hold You To
Twenty-four jurisdictions have adopted the NAIC Model Bulletin on AI. Most carrier compliance teams are working to the regulatory text. Their reinsurers will use the same document as an evidentiary baseline at the next placement, and the cedent that meets the floor and stops there is preparing for the wrong audience.
Massachusetts AI governance FAQs
What is Massachusetts Bulletin 2024-10?
Which companies have to comply in Massachusetts?
Can our AIS Program use the NIST AI Risk Management Framework?
How will Massachusetts enforce it?
How does a Massachusetts insurer get ready?
Sources
- Massachusetts Division of Insurance, Bulletin 2024-10 (December 9, 2024)
- NAIC Model Bulletin on the Use of AI Systems by Insurers (Dec 4, 2023)
- M.G.L. c. 176D (Unfair Methods of Competition and Unfair and Deceptive Acts and Practices in the Business of Insurance)
- M.G.L. c. 175A (Regulation of Rates for Certain Casualty Insurance)
- M.G.L. c. 176W (Corporate Governance Annual Disclosure)
Get audit-ready for Massachusetts Bulletin 2024-10
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