Your Claims AI Makes Thousands of Decisions Daily. Can You Explain Them?
APRA-regulated insurers face CPS 230 operational risk requirements. ASIC is watching pricing algorithms and claims handling. The Privacy Act 2024 requires transparency about automated decisions. Your AI governance needs to cover all three.
Where Insurers Use AI
Each use case has different risk profiles and regulatory considerations. Pricing and claims decisions need the most attention.
Pricing & Underwriting
Risk-based pricing algorithms. ASIC watches for unfair discrimination. Need to demonstrate fairness and explain pricing factors to customers.
High regulatory scrutinyClaims Automation
Straight-through processing, fraud detection, damage assessment. Decisions directly affect policyholders. Need human review paths.
High regulatory scrutinyFraud Detection
Pattern recognition for suspicious claims. False positives affect legitimate claimants. Need accuracy monitoring and appeal processes.
Medium scrutinyCustomer Service
Chatbots, policy queries, renewal reminders. Lower risk but still need transparency about AI use and escalation paths.
Lower scrutinyWhat Regulators Expect
APRA-regulated insurers face prudential requirements. ASIC oversees conduct. Both expect governance.
Prudential Requirements
CPS 230, CPS 234, CPS 220
- • CPS 230: AI systems are operational risks requiring identification, assessment, and management
- • Third-party AI: Vendors in material service provider register by October 2025
- • Board oversight: Directors must understand AI risks in their business
- • CPS 234: Information security for AI systems and data
Conduct Requirements
Consumer protection, fair dealing
- • Unfair pricing: Algorithms must not discriminate on prohibited grounds
- • Claims handling: Fair, timely, transparent decision-making
- • Design & distribution: AI-driven product recommendations must suit customers
- • REP 798 lessons: Governance gaps found across financial services apply here too
Privacy Act 2024 (December 2026)
New automated decision-making transparency requirements. If your AI makes decisions that significantly affect customers, you'll need to explain how and give them ways to challenge those decisions.
Insurance AI Governance Services
Frameworks designed for APRA-regulated insurers and their specific AI use cases.
AI Governance Frameworks
Operating models, approval workflows, and board reporting for insurance AI. Built around claims, pricing, and underwriting use cases.
Learn more →AI Risk Frameworks
CPS 230-aligned risk taxonomies for insurance AI. Assessment methodologies that satisfy APRA expectations.
Learn more →AI Audits
Independent review of pricing algorithms, claims automation, and fraud detection systems. Find issues before regulators do.
Learn more →Claims AI and Pricing Algorithms Need Governance
Get a clear view of your AI risk exposure and what APRA and ASIC expect. We'll map your AI systems and show you what needs attention.