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Bill

HB 2174

insurance; modeling organizations; predictive models

57th Legislature - Second Regular Session Introduced by Walt Blackman and 1 co-sponsor

HB 2174 requires Arizona insurers to disclose their use of predictive models and algorithmic tools in underwriting decisions, establishing accountability for algorithmic insurance pricing.

Signed by Governor
0
WeVote Research Nonpartisan
Bill Summary · HB 2174

Legislative bill overview

HB 2174 regulates how insurance companies use predictive models and algorithms in underwriting and pricing decisions. The bill requires insurers to disclose their use of modeling organizations and algorithmic decision-making tools, and establishes accountability measures for how these tools affect coverage and rates.

Why is this important

Insurance pricing and coverage decisions directly impact consumers' access to and cost of essential coverage. As insurers increasingly rely on complex algorithmic models—sometimes using non-traditional data sources—transparency and oversight become critical to prevent discriminatory practices and ensure fair treatment across demographic groups.

Potential points of contention

  • Competitive concerns: Insurance companies may argue that requiring disclosure of their predictive models exposes proprietary business methods and creates competitive disadvantages
  • Compliance costs: Implementing new transparency and accountability requirements could increase operational expenses that insurers might pass to consumers through higher premiums
  • Definition and scope ambiguity: The bill's specific requirements for which "modeling organizations" and "predictive models" trigger disclosure obligations may be unclear, creating compliance uncertainty

Compiled from official sources — confirm details with the bill’s official record.

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