ALLIANCE QUESTIONS N.M. PRIVACY RULES

The Alliance of American Insurers has questioned the legality of recently adopted privacy regulations in New Mexico. According to Rey Becker, president of property/casualty for the Alliance, “Earlier this year, the New Mexico Legislature directed the superintendent of insurance to adopt rules governing the privacy of ‘nonpublic personal information of insured persons.’ Thus, New Mexico law authorizes rules governing only applicants for policies and actual policyholders, in other words, the folks that have a business relationship with the insurer and pay the premiums. Unfortunately, the superintendent ignored the clear wording of the law and unilaterally broadened the rules to cover third-party liability claimants and workers compensation claimants, who are clearly not insured persons.” Becker added that in the case of workers’ comp claimants, this also violates the clear scope of the federal Gramm-Leach-Bliley Act. “Most troublesome of all is the creation of a new ‘opt-in’ system, which will create additional costly barriers for insurers wishing to write business in New Mexico, and place them at a disadvantage compared to banks and securities firms, which remain subject to the more cost-effective ‘opt-out’ approach,” Becker said.

Topics Mexico New Mexico