Colorado moves to restrict surveillance pricing

This is surveillance pricing: A plane ticket that costs more because you searched online for an obituary and need to travel. Or a parent who gets offered a lower salary because her social media mentions a sick child who needs health insurance.

Why it matters: Both scenarios show how companies can set individualized pricing and wages — often using artificial intelligence or algorithms — based on personal characteristics, online behaviors and biometrics.

Driving the news: Colorado lawmakers want to prohibit surveillance pricing, in particular, those systems that discriminate against consumers and workers. A Senate committee advanced the measure at a hearing on Tuesday.

• In situations where algorithms can set prices, companies would need to publish their procedures to ensure the accuracy of data and give consumers the ability to correct it, per the bill.
• State Sen. Mike Weissman (D-Aurora) said the legislation is intended to "protect people from abusive businesses."

Caveats: The new restrictions would include numerous carveouts, such as voluntary membership and loyalty programs. They also would not apply to federal, state or local government workers.

What they're saying: "There's no transparency, no accountability and no way for consumers and workers to know what's happening behind that curtain," state Sen. Iman Jodeh (D-Aurora), a bill sponsor, said at a rally Tuesday ahead of a legislative hearing.

The other side: The business community testified that the legislation is too far-reaching and would disrupt normal business practices, including those that benefit consumers.

The big picture: Nationwide, the debate is one of the top issues in state legislatures this year as lawmakers push for added disclosure and protections for vulnerable populations.

• More than 40 related bills to regulate surveillance pricing were introduced in two dozen states, industry experts note.