The Chartered Insurance Institute (CII) said both institutions and individuals must be held accountable for decisions made using artificial intelligence (AI) in financial services.
In its recommendations to the Treasury Select Committee, the 120,000-strong membership body said firms should be responsible for outcomes created by AI, whether through design or monitoring.
The CII said professionals should “always be prepared to take accountability for the outcomes created by AI, either through design or monitoring.”
The organisation added that all professionals should be educated on the potential harm that can come from mis-managing AI.
In its submission, the CII said firms must be responsible for decisions made by their algorithms, “even if it is not feasible to explain in detail how the algorithms produce their results.”
The CII said this accountability must come with validation and testing for things like discriminatory harm, and called for firms to publish the results of these tests.
The CII recommended a proportionate regulatory approach, backed by a sector wide skills strategy.
It said all employees should get education on the potential and risks of AI, in order to balance optimising its use and protecting consumers.
The CII said this would allow healthy debate among firms and the wider profession on the most effective use of AI, helping to increase trust over time.
Consumer research carried out by the CII as part of its Public Trust Index found AI could support areas that matter to customers and small businesses in insurance, such as cost, protection, ease of use, and confidence.
Additionally, the CII pointed to its Digital Companion to the Code of Ethics and Addressing Gender Bias in Artificial Intelligence guides as practical steps for using AI responsibly.
Dr Matthew Connell, director of policy and public affairs at the CII, said: “While AI has been employed within insurance for many years, it is important that we continuously assess how it can be optimised for both professionals and consumers.
“We welcome the opportunity to offer recommendations to the Treasury Select Committee, and utilise the extensive consumer research carried out by the CII to inform this work on AI in financial services.”
