Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps her Department is taking to help ensure transparency in the insurance industry's use of algorithmic and AI pricing models.

The government is determined that insurers should treat customers fairly and firms are required to do so under Financial Conduct Authority (FCA) rules. The FCA requires firms to ensure their products offer fair value (i.e. if the price a consumer pays for a product or service is reasonable compared to the overall benefits they can expect to receive). The FCA has been clear that it will be monitoring firms to make sure they provide products that are fair value, and, where necessary, it has robust powers to take action.

The government believes that the safe and effective adoption of artificial intelligence (AI) in financial services is a major strategic opportunity, with the potential to power growth across the UK.

As set out in the government’s Financial Services Growth and Competitiveness Strategy, it is our ambition to make the UK the world's most technologically advanced global financial sector, leveraging our dual strengths in financial services and AI.

To support the effective and safe use of AI by industry, while protecting consumers and financial stability, the government has appointed Financial Services AI champions, Harriet Rees and Rohit Dhawan. They will focus on helping firms seize the opportunities for AI in a way that supports innovation, maintains trust in UK financial services, and ensures that consumers are appropriately protected.