NAII Submits Comments to Regulators

Wrapping up a year of work, the Privacy Notification Subgroup of the National Association of Insurance Commissioners (NAIC) is accepting comments from industry and other interested parties on its draft of
language and analysis that companies can utilize when crafting privacy notices for customers.

The National Association of Independent Insurers’ (NAII), a member on the subgroup, sent written comments that recommended that the ‘substance’ of the privacy notice, rather than brevity, should be the priority.

“The goal was to create consumer friendly wording that insurers could reference for guidance when creating company privacy notices. The subgroup came to the conclusion that content was more important than the length of the notice because it is vital that the customer understands the company’s privacy policy – rather than have the notice so brief that the message gets lost,” NAII Insurance Services Counsel Kathleen Jensen emphasized. “Ultimately it is the customer, however, who must make the decision to read the notice and become truly informed – whether the length of notice is long or short.”

Among other recommendations made in the letter, NAII suggested that the introduction section of the material sent to companies clearly state that “ultimately it is each individual company that must determine what needs to be included in the notice…and that it is solely up to the insurers’ (or licensees’) discretion whether to utilize the suggestions in the NAIC report.”

The letter emphasized that is important for insurers to be aware that the privacy notice recommendations are not “best practices” or proposed model language, but merely suggestions about how a notice could effectively be worded.

“NAII is pleased that the NAIC is assisting the industry by providing possible examples of analysis and language that is both legally compliant and consumer friendly regarding privacy notification,” Jensen said.

The issue of privacy notices is on the agenda for the Consumer Liaison Committee meeting at the NAIC Winter Meeting, Dec. 7 – 10 in San Diego.