New Jersey A5494 prohibits insurers from using artificial intelligence to deny homeowner, automobile, and flood insurance claims.
New Jersey A5494 aims to enhance transparency in the insurance claims process by banning the use of artificial intelligence in making final decisions to deny homeowner, automobile, and flood insurance claims. The bill defines artificial intelligence as a technology system trained on data, designed to simulate human communication, and generating non-scripted outputs with limited or no human oversight. Insurers violating this prohibition face penalties of up to $5,000 per violation, collected through a summary proceeding under the "Penalty Enforcement Law of 1999.
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