Washington — The
The FTC decision compels the country’s top nine homeowners’ insurance companies, by market share, to furnish the data to help complete a study of credit-based insurance scores and homeowners insurance, as required by Fair and Accurate Credit Transactions Act of 2003.
“We are disappointed the FTC chose this route, despite the industry’s good faith efforts to work cooperatively to find a sensible, secure and cost-effective alternative to provide the data the FTC says it needs to conduct its study,” says David Snyder, AIA VP and assistant general counsel. “The use of a ‘compulsory process’ does not allay our serious concerns about the handling and protection of massive amounts of consumer data.”
In July 2007, the FTC released a study of automobile insurance and credit-based insurance scores without demanding information from insurers, Snyder notes. “We’re confident the FTC, just as they found in their auto study, will learn the same thing in this latest examination,” he says.
Additionally, AIA says the FTC has demanded information far beyond what is needed, and is even asking for data insurers do not always collect.
“Consumers should be very concerned that the FTC has ordered companies to hand over such a vast amount of data, including items like a policyholders’ social security number and mortgage information, with few assurances as to how that data will be analyzed, handled, stored and used,” Snyder says. “We will be watching this process as it plays out to do our best to ensure that company and consumer interests are protected.”
Source: American Insurance Association
