In an article titled “Clashing Laws on Consumer Data Privacy May Turn Into New Headache,” Life Annuity Specialist reported that states are following California’s lead on developing stricter laws to beef up consumer rights and protections on how their personal data is used, leaving insurers facing a wide range of questions. The publication turned to insurance partner Jo Cicchetti for insight on corporate governance and compliance in the insurance industry.
Cicchetti highlighted that, for decades, life insurers have built systems and best practices to comply with federal and state requirements governing consumers’ personal financial and health information. She also noted that the National Association of Insurance Commissioners (NAIC) has promulgated model laws for the states regarding ensuring the privacy and security of insurance customer data.
Cicchetti warned that if more state laws are imposed on the industry, the additional compliance burdens will “impact product costs to consumers and will result in differences among consumers’ rights based on their state of residence,” she said. “Some also believe that product and service innovation could be adversely affected.”
Lastly, she explains that the NAIC has established a working group to review state insurance privacy protections, so if gaps are identified, further guidance will probably be provided through new or amended model laws.
The full article is available for Life Annuity Specialist subscribers.