Insurance Online: Regulation and Consumer Protection in a Cyber World

Insurers and insurance intermediaries sell and market insurance online and utilize social media to promote their products and evaluate consumer behavior. Historically, insurance companies have been significant collectors and users of customer-related information; the age of “Big Data” has greatly accelerated both the types of information collected and how it is used, creating new opportunities for developing, underwriting, and marketing insurance products. However, the online or cyber world similarly creates new challenges for regulators and risks to consumers, including the complexity of underwriting and risk classifications, multiple distribution channels that cross regulatory boundaries and are increasingly global in reach, and consumer privacy and ownership of data. These new realities in turn implicate the growing risk of cyber or data breaches and the ability of third parties to illegally access and utilize the immense amounts of confidential information insurers and other institutions now routinely collect.