According to the National Association of Independent Insurers (NAII), a consumer privacy regulation proposed by the Missouri Insurance Department is contrary to state law because a third party claimant provision goes beyond the federal Gramm-Leach-Bliley (GLB) Act.
In a letter to the department, NAII Counsel Ann Weber said, “The state law enacted earlier this year gives the department authority to adopt privacy regulations but specifies that those regulations must be consistent with and not more restrictive than GLB.
“The definition of ‘consumer’ and ‘customer relationship’ in the proposed regulation is broad enough to include third party claimants, which goes beyond the scope of GLB,” Weber continued. “This regulation will require the insurer to provide an initial notice of its privacy policies and practices as well as an opportunity to ‘opt out’ to all third party claimants before it discloses nonpublic personal financial information to nonaffiliated third parties.
“Since the claimant is put into the same category as the policyholder, the yearly notices will have to be provided to both. Additionally, there is no clarification as to when the third party claimant’s ongoing relationship with the insurance company will end and the company’s obligation cease.”
Weber urged the department to delete the provision from the regulation, which closely follows an emergency regulation that went into effect July 1. Weber objected to that provision in the emergency regulation when it was adopted as well. She commended the department at that time for deleting health information and workers’ compensation provisions that previously had been contained in the proposal.
Topics Legislation Missouri
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