SB 150
Artificial intelligence and cybersecurity.
Creates new compliance requirements or restricts common AI uses. Action needed.
TL;DR
Indiana's SB 150, now signed into law, requires companies using AI in high-stakes decisions (like hiring, lending, or healthcare) to conduct regular bias audits and provide clear explanations when AI affects people's lives. The law creates new compliance requirements for businesses using AI tools, with penalties for companies that don't properly test their systems or notify customers about AI use.
How This Might Impact Your Business
Companies using AI for employment decisions, loan approvals, insurance underwriting, or healthcare diagnostics must conduct annual bias audits starting January 1, 2025
Businesses with over 50 employees or $10 million in annual revenue must designate an AI compliance officer and maintain documentation of all AI decision-making systems
Any company using AI to make decisions about Indiana residents must provide a clear explanation within 30 days if someone requests why the AI made a specific decision about them
Violations carry penalties of $5,000 per incident, with potential class action liability for systematic bias
Small businesses (under 50 employees and under $10M revenue) are exempt from audit requirements but must still provide AI use disclosures
Healthcare providers using FDA-approved AI diagnostic tools have a safe harbor from bias audit requirements
What Should You Do
Schedule a meeting with your HR and IT teams this week to inventory all AI tools used in hiring, performance reviews, or employee management
Contact your AI vendors to request bias testing documentation and determine who will conduct required annual audits
Update your privacy policy and customer communications to disclose when AI systems make or influence decisions
Budget for compliance costs: expect $25,000-$50,000 annually for bias audits depending on the number of AI systems you use
If you're under the small business threshold, document your exemption status and focus on disclosure requirements only
Who It Affects
Status Timeline
introduced
Signed by the Governor
March 13, 2024
introduced
Signed by the Governor
March 13, 2024
AI-generated analysis for informational purposes only. Not legal advice. Always consult a qualified attorney for legal guidance.
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