How to Protect Clients' Insurance Data Amid Growing Data Privacy Concerns
The insurance industry has been slow to go digital, but that’s about to change. InsurTech, the use of technology in insurance to drive efficiencies and provide better customer experiences, is helping to bring the insurance industry into the digital age, slowly but surely.
But with that comes entirely reasonable privacy concerns. After all, insurance data contains a wealth of sensitive information about customers, from credit history to protected health information. And a 2021 report shows that the insurance industry is more likely than any other industry to experience a data breach.
The desire to protect our data is growing: 63% of global consumers don’t believe companies are transparent about the way they use their data, and 48% of consumer have stopped buying from a company due to privacy concerns.
So, how do you help protect clients’ insurance data while still improving their user experience? Let’s dive into it.
Show the Benefits
Not all data collection is something to fear. Consider pay-per-mile insurance: it uses an app or device to track your mileage so that you’re only paying for insurance when you’re actually driving. This program has the potential to net consumers serious savings, at a time when 58% of drivers believe they pay too much for car insurance.
This is where you come in as an agent. By being transparent and educating your customer on how the data is used to mitigate risk, reduce losses, prevent claims, and lower costs for insurance companies all while saving the driver significant money on car insurance, you can help alleviate your customer’s data privacy concerns.
People understand that their data has value and don’t want to give it away without anything in return. 39% of people like the idea of financial compensation for their data, and 20% most value product discounts. As an insurance agent, you can show them how to save more on insurance and get value for their data.
Safeguard Sensitive Information
As an insurance agent, you have access to a wealth of incredibly sensitive information about your clients. Demonstrating that you care about protecting that information is key to maintaining your clients’ trust, especially when 86% of consumers say that data privacy is a growing concern.
Maintaining a clean desk policy (eg. locking your computer as soon as you step away, securing personal documents immediately, and not leaving passwords or keys laying around) is a simple but effective way to show you care about your clients’ data and help to prevent any breaches.
Making sure you understand applicable laws and guidelines around data privacy is also important and shows your clients that you care. Here are just some of the data privacy requirements you should be familiar with as an insurance agent:
- General Data Protection Regulation (GDPR) protects the personal information of European Union residents, even when they’re outside of the EU.
- The California Consumer Privacy Act (CCPA) protects the personal information of California residents.
- The Health Insurance Portability and Accountability Act (HIPAA) helps prevent fraud and abuse of personal healthcare data.
- The Gramm-Leach-Bliley Act (GLBA) is a law that requires insurance companies to explain to customers how they share information and to protect customer data.
- Sarbanes-Oxley Act (SOX) requires insurance organizations to be more transparent and secure through increased documentation and protection.
- Payment Card Industry Data Security Standard (PCI DSS) sets in place standards to protect customers’ credit card data.
These are just some of the policies and laws in place that help protect you and your clients. Understanding the requirements of each and following their best practices will go a long way toward reassuring your clients.
Transparency Around Data Use
It also helps to explain to clients exactly why certain information is being requested of them, what it’ll be used for, and how it helps secure them the best rates. For example, your clients can find life insurance without sharing medical information, but they’ll get better rates and coverage if they do. By showing that their health data is used simply to create the best insurance policy possible for them, you can help build their trust while safeguarding their information.
The Bottom Line
When clients trust you with their business and their sensitive information, it’s up to you to take that responsibility seriously. Data privacy concerns are only going to grow with the increased reliance on technology, and it’s time to ensure you’re up to date on applicable laws, standards, and best practices. Doing so will not only cement your clients’ trust in you but net you, lifelong clients. Find out how ConsumerCoverage helps keep data secure here.