Hi Derek! Thanks for replying.
I did wonder about this but found another service we have in house here where this is used, so it works.
Also I figured this whole issue out yesterday.
I ended up needing to import the api policy to Pulumi (which we had trouble with earlier, but that was because of a fault in our import command.) So when the policy was imported we were successful with overwriting the imported policy in the Pulumi program. The policy was then updated by Pulumi in Azure.