November 27, 2001
Donald S. Clark
Federal Trade Commission
600 Pennsylvania Avenue, NW
Washington, DC 20580
Dear Mr. Clark:
Proposed Guiding Principles for Interagency Public Workshop on
Financial Privacy Notices
The Alliance of American Insurers is a national trade association of 326
property/casualty insurers. While insurer privacy practices are regulated by
state insurance departments, we recognize the inter-relationship between
state insurance department regulations and federal rules applicable to other
elements of the financial services industry. Thank you for the opportunity
to comment on this process.
The Alliance is suggesting some proposed parameters or guiding principles
for the federal agencies involved in the workshop. The concepts are
inter-related, and the order of listing here is not necessarily in order of
Privacy notice language should be clear and conspicuous, so that it is
reasonably understandable and designed to call the consumer’s attention to
the nature and significance of the information. Title V of the Gramm-Leach-Bliley
(GLB) Act, federal rules, and the 2000 National Association of Insurance
Commissioners (NAIC) model privacy regulation already provide guidance.
Examples already include: short sentences, bullet points, avoiding highly
technical business terminology, use of plain language headings, easy to read
type face and type size, etc.
Fairness & Balance
Any privacy notice language developed should recognize and acknowledge both
legitimate consumer concerns and rights, as well as legitimate business
needs and uses for nonpublic personal information.
No attempt should be made to steer consumers toward or away from any sort of
preordained opting choice. Within the consumer protections already afforded
by Title V of GLB, federal rules, and the 2000 NAIC model regulation, no
attempt should be made to dictate or prohibit the use of any particular type
face, type size, color, format, medium or technology.
Given the wide array of insurer corporate structures, lines of business,
customer profiles, and marketing strategies, etc., an effective “one size
fits all” approach may not be workable or desirable. Within existing
consumer privacy protections, nothing should be done that would stifle
financial service company innovation. Any model privacy notice language(s)
developed should be a “safe harbor”, not a mandate.
In addition to the flexibility to be different, it is also important for
affiliated financial services companies to also be able to use the same
privacy notice for all of their products and services.
The administration and content of privacy notices and the opting process
should be addressed in a cost-effective fashion for both consumers and
financial services companies, since higher costs often translate into higher
fees or premiums, or lower returns for financial services consumers. Often
the seemingly “easiest” or “most convenient” approach for the consumer can
ultimately translate into the most expensive.
Any roll-out or start date for federal model language should be coordinated
with the NAIC and other state regulators. Sufficient lead-time is crucial.
Any changes should be applied prospectively to new business and/or upon
Consistency & Uniformity
Any model language should be consistent with Title V of GLB and existing
federal rules. This process should be used to improve and “fine tune” the
implementation and enforcement of GLB. The process should also encourage the
NAIC and state insurance departments to promote operational consistency with
federal requirements, as well as between and among the states.
Uniformity between and among the state insurance privacy approaches is
desirable, but literal uniformity may not be possible, given that many
states have laws or regulations that deviate from GLB, the 2000 NAIC model
regulation or are based upon the 1982 NAIC model law. Further, this process
should not be used to develop new substantive or procedural mandates beyond
the scope of GLB.
Level Playing Field
Banks, securities firms, and insurers should be allowed, under both federal
and state approaches, to use similar language to avoid competitive
disadvantage(s). Affiliated financial services companies should also be able
to use the same privacy notice for all of their products and services, if
they so desire. The same should be true between and among states.
If you need any further information, please contact me (630.724.2109) or Ken
Schloman (202.822.8811) in our Federal Affairs office.
Reynold E. Becker
Copies to: Lenore Marema
Contact Us | Search | Complaint Form | Privacy | Site Map
Wednesday, November 28, 2001