Unfair Discrimination

The practice of treating individuals or groups differently without a legitimate, non-discriminatory basis, particularly when AI systems are used in insurance to make decisions that result in adverse outcomes for policyholders or applicants.

Discrimination based on an individual's race, color, national or ethnic origin, religion, sex, sexual orientation, disability, gender identity, or gender expression in any insurance practice.

The practice of treating individuals or groups unequally in insurance decisions without a legitimate actuarial or underwriting basis, often a key risk addressed by AI regulation.

This term refers to the use of external consumer data, algorithms, or predictive models that correlate with protected characteristics (e.g., race, sex) and result in disproportionately negative outcomes for these groups. The negative outcome must exceed a reasonable correlation to underlying insurance factors like losses and costs.