GAO: States Trail Feds On Privacy
Washington
State insurance authorities are behind most federal regulators in establishing standards for safeguarding consumer privacy under the Gramm-Leach-Bliley Act, the General Accounting Office says.
A GAO report said that while most states have adopted regulations or enacted legislation based on a model regulation developed by the National Association of Insurance Commissioners, there is no guarantee that all states will consistently implement the regulation. GAO also noted that there is considerable variation in the privacy standards adopted by the states.
By contrast, GAO said, except for the Federal Trade Commission, all the federal agencies charged with implementing GLBs privacy requirements have already issued their final standards.
GAO noted that in response to a draft of its report, the Kansas City, Mo.-based NAIC said that states have worked hard to meet GLB's privacy requirements and have accomplished a great deal. Every state except Alaska has privacy protections in place that meet or exceed GLB's standards, NAIC said.
However, the American Insurance Association in Washington said the GAO report shows the need for greater uniformity among the states. "This patchwork of state regulation puts insurers at a competitive disadvantage with financial services entities regulated by the federal government," said Stephen Zielezienski, AIA's assistant general counsel.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, May 27 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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