Consumer Watchdog has raised concerns about Insurance Commissioner Ricardo Lara’s proposal to allow insurance companies to use private black-box models and AI to predict the risk of catastrophic wildfires, arguing that it will lead to higher home insurance rates without transparency or accountability. The proposal does not require testing of models for accuracy or fairness, does not establish uniform standards for their use, and keeps models secret. Consumer Watchdog urges the creation of a public model open to scrutiny and opposes the use of catastrophe models to charge higher rates unless there is public oversight and review.
