The bill mandates insurers to disclose when AI is used in denying insurance claims, including the basis for the decision and appeal instructions.
If you are an insurer using AI to deny claims in Texas, you must disclose AI's role and appeal instructions by September 1, 2025, or face penalties.
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Affected Industries
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What This Means
Texas House Bill 4635 aims to enhance transparency in the insurance industry by requiring insurers to disclose the use of artificial intelligence in claim denials. This legislation impacts insurers and health maintenance organizations, mandating clear communication about AI's role in decision-making processes. As AI becomes more prevalent in insurance, compliance with this bill will be crucial for maintaining trust and accountability.
Key Provisions
- Insurers must disclose AI's role in claim denials.
- Written disclosure must include the basis for AI's determination.
- Claimants must receive instructions on how to appeal the denial.
Latest Legislative Action
Left pending in committee
Bill Sponsors
| Name | Role | District |
|---|---|---|
| Cassandra Garcia Hernandez D | Sponsor | HD-115 |
| Hubert Vo D | Sponsor | HD-149 |
Compliance Checklist
Who: Insurers and health maintenance organizations
Deadline: By September 1, 2025
Penalty: Potential penalties for non-compliance
Who: Insurers and health maintenance organizations
Deadline: By September 1, 2025
Penalty: Potential penalties for non-compliance
Full Legal Analysis
Official Source
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Affected Industries
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