HB 4635

relating to disclosure of the use of artificial intelligence in the
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Subtitle B, Title 5, Insurance Code, is amended
by adding Chapter 526 to read as follows:
CHAPTER 526.  USE OF ARTIFICIAL INTELLIGENCE
Sec. 526.001.  DEFINITIONS.  In this chapter:
(1)  "Artificial intelligence" means an engineered or
machine-based system that varies in autonomy and may, for explicit
or implicit objectives, infer from the input the system receives
how to generate outputs that can influence physical or virtual
(2)  "Health maintenance organization" and "insurer"
have the meanings assigned by Section 401.001.
Sec. 526.002.  DISCLOSURE REQUIRED.  An insurer or health
maintenance organization that denies a claim based on a
determination made by artificial intelligence shall provide to the
claimant with notice of the denial a written disclosure containing
(1)  a notification that the denial was based on a
determination made by artificial intelligence;
(2)  the basis for the determination made by artificial
(3)  instructions on appealing the denial with the
insurer or health maintenance organization.
SECTION 2.  Section 526.002, Insurance Code, as added by
this Act, applies only to a claim submitted on or after the
SECTION 3.  This Act takes effect September 1, 2025.