By The Restoration HQ desk · · filed under Tech & AI
Will your next claim be denied by a computer? Regulators are finally asking
The NAIC's AI model bulletin has now been adopted or mirrored by 25+ states, requiring AI-supported claim decisions to comply with unfair-claims-settlement standards. California's SB 1120 bars denials made solely by automated tools without licensed human review. The policyholder bar is openly framing algorithmic denial as a bad-faith question, and regulators are probing whether human oversight is "meaningful or theater."
FORIf a computer denied it, that's a compliance problem for the carrier, not just a headache for you, learn the AI rules in your state and use them.
AGAINSTA bulletin with no teeth in 25 states is not protection; carriers will automate denials until somebody makes it expensive.
Consensus vs. contrarianConsensus: AI makes claims faster. Contrarian worth owning: "meaningful human review" is the new battleground: the operator who asks, in writing, who reviewed the denial and how long they spent is the one who breaks the algorithm's cover.
Sources Merlin Law Group, www.propertyinsurancecoveragelaw.com/blog/ai… (); NAIC model-bulletin adoption, actuary.info/insights/ai-regulation-insuranc… regulatory clock, www.pcmicorp.com/2026/04/the-regulatory-cloc…