AmazonScience/document-haystack

1The GDPR imposes requirements on the transfer of personal data outside of the EEA, including via standard contractual clauses 2supplemented by an assessment and due diligence of the legal and regulatory landscape of the jurisdiction of the data importer, the 3channels used to transmit personal data and the processors or subprocessors that may process personal data.4The NAIC and certain U.S. states have adopted or are considering regulations and guidance relating to the use of “big data,” AI, 5machine learning and other technology innovations in the insurance marketplace. For example, Colorado and New York have adopted 6regulations or guidance with respect to the use of external consumer data and information sources in underwriting for life insurance, 7including the use of algorithms and predictive models. In December 2023, the NAIC adopted a model bulletin on the use of AI by 8insurers that sets forth governance, risk management and other requirements that insurers using AI are expected to establish. In 9addition, state insurance regulators in the United States have issued and will continue to consider regulations or proposed guidelines 10in the use of external data, algorithms and AI in insurance practices, including underwriting, marketing, and claims practices.11The EEA and the UK have also taken steps to regulate the use of data and algorithms used for the purpose of AI and automated 12decision-making. On December 9, 2023, the European Parliament and European Council reached a provisional agreement on the 13European Union Artificial Intelligence Act, which, once formally adopted, will broadly regulate the use of AI within the European Union. 14European countries, and supranational political organizations like the EU and the Council of Europe, are expected to continue taking 15an active role in regulating AI in ways that may impact the insurance industry in the future.16We also are subject to other international laws and regulations that require financial institutions and other businesses to protect 17personal and other sensitive information and provide notice of their practices relating to the collection, disclosure and other processing 18of personal information and to obtain consent for specific processing activities. We are also subject to laws and regulations requiring 19notification to affected individuals and regulators of security breaches and laws and regulations regarding data localization and the 20cross-border transfer of information.21CLIMATE CHANGE22In recent years, federal- and state-level lawmakers and regulators in the United States and in other major countries in which we 23operate have increased their scrutiny on financial institutions’ and other companies’ governance, risk oversight, disclosures, plans, 24policies and practices in connection with climate change. Throughout 2023, there have been active and significant regulatory 25developments on these issues in the form of newly proposed, issued or implemented laws, rules, regulations, guidance and 26frameworks regarding climate change that impose, or will impose if and when effective, new requirements and expectations, including 27in connection with climate-related governance, risk management, disclosures, stress testing and scenario analysis. Regulators in 28several jurisdictions are considering the so-called protection gap as it relates to climate – which is the view that populations are under-29insured or that there is insufficient coverage to protect policyholders against the risks associated with climate change. In addition, the 30SEC has proposed rule changes on climate-related disclosure. The proposed rule would require registrants, including public issuers 31such as us, to include certain climate-related disclosures in registration statements and periodic reports. These proposed disclosures 32include information about climate-related risks that are reasonably likely to have a material impact on the registrant’s business, results 33of operations, or financial condition, and include a new note to their audited financial statements that provides certain climate-related 34metrics and impacts on a line-item basis. The proposed climate-related disclosures would also include disclosure of a registrant’s 35greenhouse gas emissions (including Scope 3 emissions) and attestation thereof, as well as information about climate-related targets, 36goals, and transition plan, if any. If adopted as proposed, the rule changes are expected to result in additional compliance and 37reporting costs. We continue to actively monitor the regulatory landscape surrounding these issues.38U.S. SECURITIES, INVESTMENT ADVISER, BROKER-DEALER AND INVESTMENT COMPANY 39REGULATION40Our investment products and services are subject to applicable federal and state securities, investment advisory, fiduciary, including 41the Employee Retirement Income Security Act of 1974, as amended (ERISA), and other laws and regulations. The principal U.S. 42regulators of these operations include the SEC, Financial Industry Regulatory Authority (FINRA), Commodity Futures Trading 43Commission (CFTC), Municipal Securities Rulemaking Board, state securities commissions, state insurance departments and the 44Department of Labor (DOL). 45Our variable life insurance, variable annuity and mutual fund products generally are subject to regulation as “securities” under 46applicable federal securities laws, except where exempt. Such regulation includes registration of the offerings of these products with 47the SEC, unless exempt from such registration, and requirements of distribution participants to be registered as broker-dealers, as 48well as recordkeeping, reporting, and other requirements. This regulation also involves the registration of mutual funds and other 49investment products offered by our businesses, and the separate accounts through which our variable life insurance and variable 50annuity products are issued, as investment companies under the Investment Company Act of 1940, as amended (Investment 51Company Act), except where exempt. The Investment Company Act imposes requirements relating to compliance, corporate 52governance, disclosure, recordkeeping, registration and other matters. In addition, the offering of these products may involve filing 53and other requirements under the securities laws of the states and other U.S. jurisdictions where offered. Our separate account 54investment products are also subject to applicable state insurance regulation.55ITEM 1 | Business5612 AIG | 2023 Form 10-K