InsureAI Wire

State AI Regulation Tracker

California

Reviewed Aug 18, 2026 Markdown →

California regulates insurer AI under its own bulletin, Bulletin 2022-5, rather than the NAIC model bulletin. Every place its text departs from the NAIC model bulletin, Dec 2023 is set out below, with the evidence on both sides.

On this page

What's different

The national model vs California
Point-by-point comparison of the NAIC model bulletin and California's own text. Each row links to the evidence on both sides.
NAIC model California
Disparate impact named — Named in terms, but no test is prescribed
Adverse action notice Tell consumers AI is in use Give the specific reason at the adverse action
Written AI programme A written programme is expected —
Third-party oversight Due diligence plus audit rights One due-diligence sentence, no vendor terms
Who it addresses Insurers holding a certificate Admitted, non-admitted and licensees alike
Examination reach Expect to be asked at examination Right to audit models expressly reserved

Click a row for the evidence on both sides. An em dash means that instrument says nothing on the point.

Related coverage

3 selected items · Reviewed Aug 24, 2026

What we compared it with

Reviewed Aug 18, 2026

California's insurer AI guidance predates the model bulletin by eighteen months and was written for a different job. Bulletin 2022-5 restates existing anti-discrimination law and reserves the Department's examination rights; it does not set up a governance program, and the Department has issued no AI bulletin since.

Every difference, with both texts

6 found

California names proxy discrimination and disparate impact in terms. The model bulletin uses neither word. Naming is as far as it goes, though: the bulletin prescribes no test and sets no threshold.

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Not in the model bulletin

"disparate" 0 hits and "proxy" 0 hits in the model bulletin; its operative wording is "bias analysis and minimization" (§3.2) and "unfair discrimination" (§2.4). Conversely "test" is 0 hits in Bulletin 2022-5, so naming the concept is not the same as requiring measurement. pypdf, 2026-08-18.

California Bulletin 2022-5, p.2

A growing concern is the use of purportedly neutral individual characteristics as a proxy for prohibited characteristics that results in racial bias, unfair discrimination, or disparate impact.

Bulletin 2022-5 · retrieved 2026-08-18

Where an algorithm drives a declination, a limitation or a rate increase, California says the specific reason must be given. The model bulletin asks only that consumers be told AI is in use and given appropriate access to information.

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NAIC model bulletin §1.9, p.5

The AIS Program should include processes and procedures providing notice to impacted consumers that AI Systems are in use and provide access to appropriate levels of information based on the phase of the insurance life cycle in which the AI Systems are being used.

California Bulletin 2022-5, pp.2-3

Additionally, when insurers use complex algorithms in a declination, limitation, premium increase, or other adverse action, the specific reason or reasons must be provided. When the reason is based upon a complex algorithm or is otherwise obscured by the technology used, a consumer cannot be confident that the actual basis for the adverse decision is lawful and justified.

Bulletin 2022-5 · retrieved 2026-08-18

The whole centre of the model bulletin is missing here. California asks for no written AI program, no governance structure and no inventory. It tells insurers that existing law already binds them and that the Department may come look.

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NAIC model bulletin Section 3, p.4

all Insurers authorized to do business in this state are expected to develop, implement, and maintain a written program (an "AIS Program") for the responsible use of AI Systems that make, or support decisions related to regulated insurance practices.

Not in California's text

Bulletin 2022-5 sets up nothing resembling an AIS Program. Across the whole 3-page, 9,037-character text: "document" 0 hits, "monitor" 0 hits, "test" 0 hits, "inventory" 0 hits, "governance" 0 hits. pypdf with loose-whitespace re-verification, 2026-08-18.

Bulletin 2022-5 · retrieved 2026-08-18

The model devotes a section to third-party data and systems: due diligence, audit rights, cooperation with regulators. California has one sentence of due diligence and never mentions the supplier at all.

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NAIC model bulletin §4.1, p.7

Due diligence and the methods employed by the Insurer to assess the third party and its data or AI Systems acquired from the third party to ensure that decisions made or supported from such AI Systems that could lead to Adverse Consumer Outcomes will meet the legal standards imposed on the Insurer itself.

California Bulletin 2022-5, p.3

before utilizing any data collection method, fraud algorithm, rating/underwriting or marketing tool, insurers and licensees must conduct their own due diligence to ensure full compliance with all applicable laws.

Bulletin 2022-5 never names a supplier: "vendor" 0 hits, "third part" 0 hits, "broker" 0 hits (pypdf over 9,037 characters, 2026-08-18). Its duty runs to the tool, not to whoever sold it, and it carries no contract, audit-right or cooperation terms.

Bulletin 2022-5 · retrieved 2026-08-18

California addresses non-admitted companies and licensees as well as admitted insurers. The model bulletin speaks only to companies holding a certificate of authority.

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NAIC model bulletin Section 1, p.1

to remind all Insurers that hold certificates of authority to do business in the state that decisions or actions impacting consumers that are made or supported by advanced analytical and computational technologies, including Artificial Intelligence (AI) Systems … must comply with all applicable insurance laws and regulations.

California Bulletin 2022-5, header

TO: All Admitted and Non-Admitted Insurance Companies, Licensees, and Other Interested Parties

Bulletin 2022-5 · retrieved 2026-08-18

Both texts land in the same place on examination: the regulator can come and look at the models themselves. California words it as a reserved right; the model bulletin words it as what an insurer should expect to be asked.

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NAIC model bulletin SECTION 4, p.7

Regardless of the existence or scope of a written AIS Program, in the context of an investigation or market conduct action, an Insurer can expect to be asked about its development, deployment, and use of AI Systems, or any specific Predictive Model, AI System or application and its outcomes

California Bulletin 2022-5, p.3

The Department reserves the right to audit and examine all insurer business practices including an insurer's marketing, rating, claim, and underwriting criteria, programs, algorithms, and models. The examinations may include examinations within the scope of market conduct examinations or SIU examinations.

Bulletin 2022-5 · retrieved 2026-08-18

What the regulator asks for

2 items
  • documentation on-request

    There is no filing to make. What there is instead is a standing reservation: the models and the criteria behind them are examinable, through a market conduct exam or an SIU exam.

    All admitted and non-admitted insurers and licensees

    Bulletin 2022-5, p.3 · read it · hide
    The Department reserves the right to audit and examine all insurer business practices including an insurer's marketing, rating, claim, and underwriting criteria, programs, algorithms, and models. The examinations may include examinations within the scope of market conduct examinations or SIU examinations.

    Bulletin 2022-5 · retrieved 2026-08-18

  • consumer notice When you send the decision

    The specific reason for a declination, limitation or premium increase has to be given, and the fact that an algorithm produced it is not an excuse for vagueness.

    Any insurer whose algorithm drives an adverse action

    Bulletin 2022-5, pp.2-3 · read it · hide
    Additionally, when insurers use complex algorithms in a declination, limitation, premium increase, or other adverse action, the specific reason or reasons must be provided.

    Bulletin 2022-5 · retrieved 2026-08-18

The NAIC's examination tool. California is one of twelve states trialling the NAIC's AI Systems Evaluation Tool, the questionnaire regulators are building for AI examinations. The trial runs from March to September 2026. Nothing in Bulletin 2022-5 refers to it. Source ↗

If you write in more than one state

California is the state where nothing is due and everything is examinable. There is no report, no attestation and no program requirement, so a carrier can look compliant right up to the day a market conduct or SIU examination asks for the model. What travels badly is the paperwork habit: a governance file built for the model bulletin answers questions California never asks, and says nothing about the one it does ask, which is why this specific consumer got this specific answer.

Based on

Sources read

Not legal advice. How this tracker is sourced →

Compare with another state

Colorado Own rules 9 differences · 5 standing obligations New York Own rules 9 differences · 6 standing obligations Texas Own rules 6 differences · 2 standing obligations

Or go back to the table of all 51 jurisdictions.