The Sunday New York Times included an interesting article ("Facebook is Using You") that looked at how people's online presence can be used against them by employers, headhunters, credit card companies -- or insurers.

It's just common sense that anyone using a social network like Facebook should be careful of what they say; every kid in America knows that posting a photo of himself hitting the bong could compromise a job or college acceptance.

But this concern goes beyond such obvious indiscretions. Article author Lori Andrews, a law professor at Chicago-Kent College of Law, relates how data aggregation companies, hired by government and industries including insurance, paw through not only Facebook postings, but searches you may have conducted on public sites like Google. The result is this:

If guitar players or divorcing couples are more likely to renege on their credit-card bills, then the fact that you've looked at guitar ads or sent an email to a divorce lawyer might cause a data aggregator to classify you as less credit-worthy. When an Atlanta man returned from his honeymoon, he found that his credit limit had been lowered to $3,800 from $10,800. The switch was not based on anything he had done but on aggregate data.

In an email conversation with me, Andrews shared a few other tidbits. Great Britain floated a proposal to raise house insurance rates for everyone with a social network page. (This almost makes sense: people who brag on Facebook about being away on vacation or buying expensive new toys are common targets for thieves).

And in 2010, AccuquoteLife.com tested a system for showing different default policy ads. Those profiled as suburban, college-educated baby boomers were shown a default policy between $2 million and $3 million; those profiled as rural, working-class seniors were shown policies around $250,000. (Julia Angwin, “The Web’s New Gold Mine: Your Secrets,” July 30, 2010.)

Clearly, while marketing strategies like this may not be illegal, they sure aren't very consumer friendly or ethical. When it comes to hot-button issues, "aggregate data" sounds like it could be the new credit scoring -- without the data to back it up.

But unlike credit scoring, people who have been "weblined" by online information don't even have the protection of law to challenge false information, Andrews maintains; currently no laws regulate what data aggregators can collect or to reveal what they know about you.

Alex Hageli, director of personal lines policy for PCI, disagrees. "In terms of underwriting, there are already rules in place that govern how insurers can rate a policy," he said. "FCRA law says anything communicated to an insurance company for purposes of underwriting is considered a consumer report."

Hageli also doubts that property-casualty insurers are rushing to use this type of information in rating or underwriting. "Maybe some of the big ones are testing the waters, but look how long it took for UBI (usage-based insurance) to be rolled out; it will take awhile and it must be actuarily justified."

Actuarially sound or not, I don't like the idea of my Web browsing habits being scoped out by my insurer or credit card company. I'd hate to think that my interest or insurance rates could go up, or coverage be denied, just because I Googled authentic Texas chili recipes (could clog arteries and become a health concern!), information on AIDS or brain cancer (gasp! preexisting conditions?) or bungee jumping (risky!).

I know that over the years independent agents have had a love/hate relationship with credit scoring. With that in mind, what do you think about the possibility of your online activity being used in this way -- either as an agent or as a consumer?

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