Indiana AI Laws and Regulation (2026)

Indiana regulates AI through targeted laws rather than a broad statute. HB 1047 (effective July 1, 2024) extended Indiana's crime of distributing an intimate image to images created or altered with artificial intelligence, HEA 1133 requires deepfake disclaimers in political ads, SB 150 created a 15-member AI Task Force with a standing annual reporting duty, and Indiana Code 27-1-52-9 limits how insurers and providers may use AI in health benefit claim decisions.

Indiana has taken a measured, targeted approach to artificial intelligence regulation. Rather than enacting comprehensive AI oversight legislation, the Hoosier State has focused on specific harms like deepfake pornography and election manipulation while developing internal government AI policies through its Management Performance Hub.

This guide covers Indiana's enacted AI laws, the state's AI governance framework for government agencies, deepfake regulations, limits on AI in health insurance claims, and how federal AI policy interacts with Indiana's regulatory landscape.

Indiana's Enacted AI Laws

Indiana has enacted AI-specific provisions in four areas since 2024: deepfake intimate images, election integrity, state government AI oversight, and the use of AI in health insurance claim decisions.

HB 1047: AI-Generated Intimate Images (2024)

Indiana House Bill 1047, authored by State Rep. Sharon Negele, took effect on July 1, 2024. It broadened Indiana's existing distribution of an intimate image offense, codified at Indiana Code 35-45-4-8, so that the definition of "intimate image" now reaches a photograph, digital image, computer generated image, or video "created or modified by means of a computer software program, artificial intelligence, application, or other digital editing tools."

Distribution is the offense, not creation. Under IC 35-45-4-8(d), a person commits the crime only if they (1) know or reasonably should know that the individual depicted does not consent to distribution of the intimate image, and (2) distribute the image. Making or altering an intimate image with AI, without distributing it, is not an offense under this section. "Distribute" is defined broadly: transferring the image to another person in or by means of any medium, forum, telecommunications device or network, or website, including posting an image to a website or application.

A separate civil remedy does reach the act of creating an image. Indiana Code 34-21.5-3-1 allows an identifiable depicted individual who suffered harm to sue a person who creates or obtains an intimate image under circumstances in which a reasonable person would understand it was to remain private, and who then discloses it to a third party with intent to harass, intimidate, embarrass, or cause serious emotional distress. That is a civil lawsuit, not a criminal charge.

Penalties under IC 35-45-4-8:

The section carves out several categories. It does not apply to an image distributed to report a possible criminal act, in connection with a criminal investigation, under a court order, to a password-protected location intended solely for personal storage or backup, or by a news reporting or entertainment medium. It also does not apply to newspapers and news services publishing through a website, to cloud service providers, or to internet providers and search engines that merely provide access to content they do not control.

HEA 1133: Deepfake Disclosure in Elections (2024)

House Enrolled Act 1133, authored by State Rep. Julie Olthoff, was signed by Governor Eric Holcomb on March 12, 2024. The law requires disclaimers on AI-generated or digitally altered political advertisements, making Indiana one of the first states to address deepfakes in campaign communications.

Key provisions of HEA 1133:

Disclosure requirement: Any campaign communication containing "fabricated media" must include the disclaimer: "Elements of this media have been digitally altered or artificially generated."

Definition of fabricated media: The law covers three categories: (1) audio or visual recordings of a person's speech, conduct, or appearance altered without their consent; (2) artificially generated audio or visual imitations of a person; and (3) audio or visual material depicting the speech, conduct, or appearance of an artificially generated person. The content must inaccurately depict the person and be unrecognizable as an imitation to a "reasonable" person.

Scope: The law covers political communications for both federal and state elections in Indiana, providing broad protection against AI-manipulated campaign material.

Enforcement: If a disclosure label is not included, the depicted candidate may bring a civil action against those responsible for paying for or sponsoring the content. Successful plaintiffs are awarded damages, court costs, and attorney fees.

HEA 1133 passed the Indiana General Assembly without any opposition, reflecting bipartisan agreement on the need to protect electoral integrity from AI manipulation.

SB 150: AI Task Force and Cybersecurity (2024)

Indiana Senate Bill 150, effective July 1, 2024, established a 15-member Artificial Intelligence Task Force to study and assess the use of AI technology by state agencies. The task force chapter is codified at Indiana Code 2-5-53.7, and IC 2-5-53.7-4 describes the body as "a temporary task force serving the general assembly."

Task Force composition: The 15 members come from varied backgrounds, including legislative members, executive branch officials, and private sector experts.

Task Force mandate: The group is charged with examining how AI is currently used by Indiana state agencies and the private sector, identifying opportunities to better serve constituents through new technologies, and recommending safeguards for data privacy and security.

Reporting requirement (annual, not one-time): Under Indiana Code 2-5-53.7-8(3), the task force must adopt and submit a report to the executive director of the legislative services agency, for distribution to members of the General Assembly, "Not later than October 31, 2024, and not later than October 31 of each year thereafter." The report must cover the results of the task force's study and assessment plus its recommendations, including any recommended legislation. The task force submitted its initial report in October 2024, but the duty is a standing annual one, not a single filing that has been discharged.

Statutory state agency AI inventory: Alongside the task force, Indiana Code 4-13.1-5 defines "artificial intelligence" for state agency purposes (IC 4-13.1-5-1) and provides that, not later than November 1, 2025, each state agency may compile an inventory of the AI technologies it uses, is developing, or is considering, and submit it to the office and to the legislative services agency for distribution to the task force. The inventory is permissive rather than mandatory: the statute says an agency "may" compile and submit it. IC 4-13.1-5-4 provides that the office may prescribe the inventory form. IC 2-5-53.7-8(1)(A) ties the task force's study directly to the AI technology "reported under IC 4-13.1-5."

Sunset: Both chapters expire December 31, 2027. IC 2-5-53.7-9 expires the task force chapter on that date, and IC 4-13.1-5-5 expires the state agency inventory chapter on the same date. Absent further legislation, the task force and the statutory inventory provisions lapse at the end of 2027.

Additional provisions: SB 150 also authorizes political subdivisions, state agencies, school corporations, and state educational institutions to adopt technology resources and cybersecurity policies. It specifies requirements for entities connecting to Indiana's state technology infrastructure.

AI in Health Insurance Claim Decisions

Indiana Code 27-1-52-9 sits in a chapter governing the downcoding of health benefits claims, added by P.L. 88-2026. It places three limits on automated decision making in health coverage, and it is the state's enacted health care AI provision.

Limit on insurers: An insurer may not use an automated process, system, or tool, "including artificial intelligence," as the sole basis to downcode a claim based on medical necessity without review of the covered individual's medical record by an employee or contractor of the insurer.

Limit on providers: A provider may not use an automated process, system, or tool, including artificial intelligence, to submit a health benefits claim without review by a provider or other person involved in the development of the claim for submission.

Disclosure duty: An insurer must disclose, in an easily accessible and readable manner, when artificial intelligence is used to make an adverse determination on a prior authorization request or to downcode a claim.

The chapter does not prohibit AI in claims handling. It requires a human in the loop before an automated system alone reduces a claim on medical necessity grounds, and it requires that AI use be disclosed when it drives an adverse prior authorization decision or a downcode.

Indiana's State Government AI Policy

Indiana's state agency AI framework has two layers: a statutory layer in Indiana Code 4-13.1-5 (the definition of artificial intelligence and the permissive AI inventory described above) and an executive policy layer administered through the Management Performance Hub. The policy layer is the more detailed of the two.

AI Policy (February 2024)

On February 20, 2024, Indiana adopted a formal Artificial Intelligence Policy through the Office of the Chief Data Officer (OCDO), Chief Privacy Officer (CPO), and Management Performance Hub (MPH).

Pre-deployment risk assessments: The policy requires most AI projects implemented by state agencies to pass a maturity assessment before deployment. This assessment is based on the NIST AI Risk Management Framework and includes 72 subcategories evaluating AI system risks.

Transparency requirements: The policy mandates "just-in-time" notices to users interacting with AI systems, informing them about how their data is used by AI, consistent with the Indiana Fair Information Practices Act.

Scope: The policy applies to a majority of AI initiatives across state agencies, with the exception of employees using general-purpose web-based generative AI applications like ChatGPT for routine tasks.

State Agency AI Systems Policy

Indiana also published a separate State Agency AI Systems Policy (Version 1.1, December 2024) providing more detailed guidance on implementation, risk classification, and ongoing monitoring requirements for AI systems used in state government operations.

AI in Indiana Employment Law

Indiana has not enacted any AI-specific employment legislation. The state does not require bias audits for automated hiring tools, impact assessments for AI-driven employment decisions, or specific disclosures when AI is used in recruitment, screening, or termination.

Indiana employers using AI in hiring are subject to federal anti-discrimination protections under Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, and EEOC guidance on AI and automated systems. Indiana's Civil Rights Law (IC 22-9) prohibits employment discrimination based on race, religion, color, sex, disability, national origin, and ancestry, but does not specifically address AI-driven discrimination.

AI in Indiana Education

Indiana has not enacted AI-specific education legislation, though the state's AI Task Force has examined AI use in educational settings as part of its broader mandate. The Indiana Department of Education has not issued formal AI guidance for school districts.

How Federal AI Policy Affects Indiana

Federal AI policy has direct implications for Indiana businesses and residents.

Executive Order 14179 (January 2025): President Trump's deregulatory approach to AI aligns with Indiana's generally business-friendly regulatory stance. The order's emphasis on removing barriers to AI innovation rather than imposing new requirements is consistent with Indiana's focus on studying AI use before implementing restrictions.

The TAKE IT DOWN Act (May 2025): This federal law criminalizing nonconsensual intimate deepfakes supplements Indiana's IC 35-45-4-8 by adding federal criminal penalties (up to 2 years for adults, 3 years for minors) on top of the state's misdemeanor and felony provisions. Indiana residents now have both state and federal avenues for addressing AI-generated intimate imagery.

NIST AI Risk Management Framework: Indiana's state government AI policy is already built around the NIST AI RMF, placing the state ahead of many peers in adopting federal best practices. Private sector employers in Indiana can reference the framework for voluntary compliance guidance.

FTC Enforcement: The Federal Trade Commission's enforcement actions against deceptive AI practices apply nationwide, providing a baseline of protection for Indiana consumers even without state-specific AI consumer protection laws beyond existing unfair practices statutes.

Indiana's Consumer Data Protection Act and AI

Indiana's consumer data protection law (SB 5, effective January 1, 2026) includes provisions relevant to AI. The Indiana Consumer Data Protection Act gives residents the right to opt out of automated profiling that produces legal or similarly significant effects.

This right to opt out of automated profiling creates an indirect constraint on AI systems that make consequential decisions about Indiana consumers, even though the law does not specifically target AI. Businesses subject to the ICDPA must provide mechanisms for consumers to exercise this right and must conduct data protection assessments for processing activities that present a "heightened risk of harm," which includes profiling. This article is for informational purposes only and does not constitute legal advice. AI regulation is a rapidly evolving area of law. Consult a qualified attorney licensed in Indiana for advice on your specific situation.

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