The Michigan Department of Insurance and Financial Services published a bulletin announcing that they are adopting the NAIC Model Bulletin on the Use of Artificial Intelligence Systems by Insurers, following in the footsteps of several other states. 

The Bulletin applies to all insurers licensed to do business in the state. It reminds them that actions or decisions affecting insureds made by AI and AI systems must comply with Michigan law and regulations, including the following: 

• The Unfair and Prohibited Trade Practices and Frauds Act, Mich. Comp. Laws §§ 500.2001 to 500.2093 (UTPFA) prohibits unfair methods of competition and unfair or deceptive acts. These rules apply regardless of the methods used by the insurer to support their actions, including the use of AI systems. 
• The Corporate Governance Annual Disclosure Act, Mich. Comp. Laws §§ 500.1751 to 500.1767 (CGAD) requires insurers to report governance practices and to provide a summary of their corporate governance structure and practices. The corporate governance framework should address the insurer's use of AI systems to support actions that impact consumers.
• 500.2403(1)(d) requires that insurance rates not be excessive, inadequate, or unfairly discriminatory. 

These laws apply regardless of the methods used to derive them, including AI and AI systems. Insurers should ensure the use of such systems do not violate the principles of the unfair discrimination laws, and rates developed using AI systems should not be in violation of the rating laws. 

Insurers are expected to develop and implement a written AIS Program for the responsible use of AI Systems. The bulletin outlines a series of general guidelines for AIS programs that includes addressing governance, risk management controls, audit functions, how AI is used with the Enterprise Risk Management System, how the AIS will address all phases of the system's life cycle, and others.