How Your Personal Information is Protected by Insurance Companies
Due to the personal nature of insurance coverage and claims, insurance companies collect and store a significant amount of sensitive personal data from their customers. Given the rise in identity theft and fraud, we are frequently asked by our clients how this information is protected.
In response to these growing threats, federal privacy laws were enacted to protect Canadians from invasion of privacy and misuse of personal information. When it comes to the information shared with your insurance company, the Personal Information Protection and Electronic Documents Act (PIPEDA) applies. PIPEDA requires that all personal information collected by private companies must be kept strictly confidential. Legislation mandates that personal information must be protected by security safeguards suitable to the sensitivity of the data. For example, access to an Accident Benefits claim containing sensitive medical information should be limited to authorized claim handlers. By limiting access to your data to only those who are essential to adjudicating your claim, the insurer reduces the risk that your data could be breached.
In the event that your data is compromised, an insurer is required to notify you. In 2015, the government of Canada passed the Digital Privacy Act. This Act established a mandatory notification for breaches that present an actual risk of significant harm to individuals. By forcing companies to disclose when their systems are breached, it encourages companies to enact strong protections. Simply put, companies know that their reputation could be irreparably harmed if they are unable to keep their customers’ data safe.
As a result of the above laws, an insurer is obligated to provide details as to what you are consenting to, explain why the information is being collected, what the information will be used for and who it will be shared with. Every effort must be made to ensure that the information used to make decisions is accurate because insurers use personal information to make decisions that affect the consumer.
If you have questions about how your personal information is being used or stored, you may contact your insurance company’s privacy officer for more information. The privacy officer can explain the insurer’s privacy protection policies and practices. Insurers are responsible for being open and honest about the way they manage your personal information.
About the Authors
Prior to joining Oatley Vigmond in 2020, Lisa worked in the insurance industry for 12 years with a focus on accident benefits claims. She has experience in adjusting complex and catastrophic claims, team leading, mentorship and alternative dispute resolution. With the knowledge and insight of how an insurance company operates, Lisa acts as the primary liaison with the accident benefits insurer and is effective at obtaining benefits from insurance companies.