The debate around telematics continues to recognise that privacy of data is an issue, but still stops short of addressing how it should be tackled, let alone resolved. This hesitancy could turn the issue into a millstone around the necks of insurers unless they act with greater resolve.
What often arises in this ‘telematics and privacy’ debate are references to the way in which many policyholders place information about themselves on social networking websites like Facebook and Twitter. There appears to be an underlying assumption that the public have now adopted a more relaxed view on privacy, of which insurers can now take advantage when introducing telematics products. That would a dangerous assumption to retain.
It would be more accurate to see such developments around the disclosure of social information as examples of how the public sees privacy less as a monolithic, ‘black and white’ concept and more as a spectrum of views based upon an exchange of value between the parties to the relationship. So while I may put something on Facebook for my friends to see, and in doing so acknowledge that others may see it as well, that shouldn’t be taken as consent for others outside of my friendship circles to use it to influence another transaction I may be involved in.
Individuals have the right to determine how information about them is used and by whom. And insurers need to recognise that consent given in one context doesn’t automatically constitute consent given to all contexts.
Insurers haven’t had much experience of consent, having been able to rely on disclosure declarations backed up by utmost good faith. Those times are changing. Utmost good faith now applies only to commercial insurance contracts and even that is receiving careful examination at the moment from the Law Commission. The recent OFT report has put a cat amongst the pigeons in how motor insurers use information obtained from claims and third parties.
Consent that is not freely given is not consent. So it is not enough for insurers to incorporate a blanket reference to consent in all policy declarations and assume that they are then free to harvest information from where ever they want. This is especially so with motor insurance, due to its compulsory nature.
Consent also needs to be informed. In other words, if you don’t know what you’re consenting to, then it’s not consent. Social networking websites like Facebook and Twitter may seem very casual and informal, but underlying them are detailed terms of engagement. Small (but in privacy terms, significant) changes to those terms have sparked furious debates between users and providers. Most fury often relates to the surreptitious way in which the more controversial changes to use of information are introduced.
So, come on, insurers. Avoid the pitfalls encountered in the US and take that next big step in the telematics debats: start talking about consent and how it can be put to proper use in insurance contracts.