The bill, H.B. No. 4635, introduces Chapter 526 to the Texas Insurance Code, focusing on the disclosure requirements for insurers and health maintenance organizations when denying claims based on artificial intelligence (AI) determinations. It defines "artificial intelligence" and mandates that when a claim is denied due to an AI decision, the insurer must provide the claimant with a written disclosure. This disclosure must include a notification that the denial was based on AI, the basis for the AI's determination, and instructions for appealing the denial.

The provisions of this bill will apply only to claims submitted on or after its effective date of September 1, 2025. This legislation aims to enhance transparency in the insurance claims process, ensuring that claimants are informed about the role of AI in the decision-making process regarding their claims.

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