Privacy considerations

Privacy considerations define the policies, procedures, and legal requirements that govern how insurance companies collect, use, store, and share personal data. Insurance providers must comply with federal laws such as HIPAA (1996) for health information and GLBA (1999) for financial data.

Insurers encrypt customer records using protocols like AES-256 to prevent unauthorized access, as reported by YourInsurance.info. Companies disclose privacy practices in notices required by state regulations such as California’s CCPA (2018).

Agents limit sharing of Social Security numbers and medical histories to underwriters or claims adjusters only when necessary. Customers can request copies of their stored data under statutes like the Fair Credit Reporting Act (1970).

Data breaches at insurers–such as Anthem’s 2015 breach affecting 78.8 million people–demonstrate risks from inadequate safeguards. Regulators fine insurers for violations; for example, Premera Blue Cross paid $6.85 million after a 2020 HIPAA settlement over exposed policyholder information.