External Consumer Data and Information Sources
Data about consumers from outside an insurer's own records, such as credit reports, public records, and behavioral data. Heavily regulated in insurance.
External consumer data and information sources, often abbreviated as ECDIS, are data points about consumers that insurers obtain from outside their own policyholder records. Examples include credit reports, public records, social media data, purchase history, marketing data, and behavioral tracking.
ECDIS is a central concern in both New York and Colorado AI regulation. NYDFS Circular Letter No. 7 requires insurers to prove that ECDIS used in underwriting and pricing does not produce unfairly discriminatory or inaccurate outcomes. Colorado’s SB 21-169 and its quantitative testing rule similarly require life insurers to test external data and predictive models for unfair discrimination.
The challenge for carriers is that ECDIS is often opaque. The insurer may not know exactly how a score was built, what variables it contains, or whether those variables proxy for protected classes. Governance programs should identify all ECDIS inputs, document their sources, and test them for disparate impact. See our guides to NYDFS Circular Letter No. 7 and the Fair Credit Reporting Act.