The insurance industry has seen its share of data breaches in recent years. But insurers aren’t the only ones at risk. All businesses and risk managers should also have data breach processes in place–those that prevent and respond to either a hacker or an internal breach, according to risk management and security experts.
Last year, both the Insurance Corporation of British Columbia (ICBC) and credit union Coast Capital revisited their practices after policyholder information ended up in the wrong hands. Preparing for, and responding to such breaches means having two strategies in place, say experts sharing data breach best practices in a June 24 podcast.
Planning: prevention & response
Organizations need a prevention plan first. That means naming a specific senior manager to take charge if a breach occurs, pre-selecting a forensic computer specialist, managing communications to the media and stakeholders and pre-negotiating services with credit monitoring services
But the response is crucial–a crisis response team should be ready to respond immediately,
Their first job: have the forensics experts determine how big–or severe–the breach is. Getting that “snapshot” of the breach can figure out what servers were impacted, when and where the breach took place, and what processes were (or weren’t) in place at the time, says Mark Greisinger, president of NetDiligence.
That snapshot will identify the kind of data that’s at risk and also help direct the company response, says Toby Merrrill, vice president of ACE Professional Risk. “A breach of 10 or 20 credit cards should be treated differently than the theft of thousands of social [insurance] numbers.”
Next, the legal members of the team should determine who should be notified. Then crisis management consultants should advise on the best way to communicate the breach.
Best practices
Organizations should keep their notifications simple, says John Mullen, an attorney at Nelson, Levine, DeLuca & Horst. “A clear company statement should let them know key facts–what’s been done to contain the breach and the timeframe, and that appropriate action is being taken,” he advises.”It’s always best to tell your story upfront.” In giving the basic facts, companies should show empathy to those affected, and accept the responsibility “taking care not to admit negligence,” he says.
They can also extend help in the form of free credit checks, he adds.
Most organizations make missteps in the wake of data breaches because they aren’t prepared. “Without a crisis response plan in place, they make rash decisions,”notes Merrill.
A sound preparedness plan should take into account a company’s culture, have its senior management on board, and should include a screening process for third-party advisors or consultants. Organizations should also carefully consider what they tell stakeholders–”there’s a tendency to over-notify,” says Merrill
But even if companies aren’t required to notify stakeholders–they may be better off in doing so to protect their reputation and really ensure customer protection he points out.
“A breach of email addresses may not seem important, but can be used by a hacker to get more sensitive information.”
Wednesday, June 30, 2010
Tuesday, June 29, 2010
Ontario regulator to create delivery standards for auto injury medical assessors
Developing industry-wide delivery standards for third-party medical examinations and standards for training and experience of assessors in auto-related injury claims are among the Financial Services Commission of Ontario (FSCO)'s top priorities for 2010.
In its 2010 Statement of Priorities, FSCO says it will be taking the following initiatives, among others, to support automobile insurance reform:
• in conjunction with health care providers and the insurance industry, develop industry-wide delivery standards for third-party medical examinations and qualifications for assessors;
• appoint a panel of experts to recommend changes to the definition of catastrophic impairment in the Statutory Accident Benefits Schedule (SABS) and develop minimum standards for the training and experience required for assessors of catastrophic impairment.
• conduct a study of closed automobile insurance claims to understand the factors contributing to cost changes and create an up-to-date framework for projecting the impact of auto insurance product design or system changes; and
• using the findings published in 2008 by the World Health Organization's Neck Pain Task Force to expand the Minor Injury Guideline to provide a more comprehensive continuum of care for those injured in auto accidents.
In a report on key initiatives of 2009, FSCO also said it had established a protocol for the processing and payment of SABS claims by the Motor Vehicle Accident Claim Fund and subsequent recovery of MVACF costs from the auto insurance industry in the event of an insolvent insurer.
"The protocol will help to ensure compensation
In its 2010 Statement of Priorities, FSCO says it will be taking the following initiatives, among others, to support automobile insurance reform:
• in conjunction with health care providers and the insurance industry, develop industry-wide delivery standards for third-party medical examinations and qualifications for assessors;
• appoint a panel of experts to recommend changes to the definition of catastrophic impairment in the Statutory Accident Benefits Schedule (SABS) and develop minimum standards for the training and experience required for assessors of catastrophic impairment.
• conduct a study of closed automobile insurance claims to understand the factors contributing to cost changes and create an up-to-date framework for projecting the impact of auto insurance product design or system changes; and
• using the findings published in 2008 by the World Health Organization's Neck Pain Task Force to expand the Minor Injury Guideline to provide a more comprehensive continuum of care for those injured in auto accidents.
In a report on key initiatives of 2009, FSCO also said it had established a protocol for the processing and payment of SABS claims by the Motor Vehicle Accident Claim Fund and subsequent recovery of MVACF costs from the auto insurance industry in the event of an insolvent insurer.
"The protocol will help to ensure compensation
Toronto businesses clean-up, check policy coverage in wake of G20 vandalism
As the City of Toronto settles down to tally the final damages caused by vandals and looters during the G20 summit on June 26-27, the Insurance Bureau of Canada (IBC) has posted general information about personal and commercial policy coverage related to the G20 event on its Web site.
The Web site notes, "the damage caused by the vandalism would generally be covered [under commercial property insurance], but loss of business income would only be covered under a business income policy."
Insurance coverage for business income is generally purchased separately from insurance on the commercial property.
There may be coverage under a commercial business income policy if a business is forced to close because of damage to neighbouring properties as a result of any perils listed in the policy.
Otherwise, the commercial business income policy requires that there be damage to the commercial policyholder's own business in order to trigger a payment due to income loss because of the business interruption.
IBC notes its information is only general in nature and directs insureds to consult their specific policies. The IBC information is available at: http://www.ibc.ca/en/G20.asp
Also, IBC points out that while the federal government is not legally bound to pay compensation for losses suffered as a result of international meetings held in Canada, the government does have information related to guidelines related to such compensation.
The information is on the Web site of the Department of Foreign Affairs and International Trade at: http://www.ibc.ca/en/G20.asp
The Web site notes, "the damage caused by the vandalism would generally be covered [under commercial property insurance], but loss of business income would only be covered under a business income policy."
Insurance coverage for business income is generally purchased separately from insurance on the commercial property.
There may be coverage under a commercial business income policy if a business is forced to close because of damage to neighbouring properties as a result of any perils listed in the policy.
Otherwise, the commercial business income policy requires that there be damage to the commercial policyholder's own business in order to trigger a payment due to income loss because of the business interruption.
IBC notes its information is only general in nature and directs insureds to consult their specific policies. The IBC information is available at: http://www.ibc.ca/en/G20.asp
Also, IBC points out that while the federal government is not legally bound to pay compensation for losses suffered as a result of international meetings held in Canada, the government does have information related to guidelines related to such compensation.
The information is on the Web site of the Department of Foreign Affairs and International Trade at: http://www.ibc.ca/en/G20.asp
Saturday, June 26, 2010
Manitoba man pays steep price for attempted $240 insurance fraud
A Winnipeg man was sentenced to 15 months' probation, perform 120 community service hours within one year, pay full restitution and write a letter of apology to Manitoba Public Insurance (MPI)'s CEO for attempting to commit a $240 insurance fraud.
Brent Disbrowe-Bear pleaded guilty to falsely reporting that his vehicle was struck by another motor vehicle while parked in a stall at his apartment complex.
There was damage to the passenger front bumper.
According to MPI's Special Investigation Unit, a witness saw a vehicle collide with a snowbank and stop sign; the licence plate matched that of Disbrowe-Bear's vehicle.
MPI confirmed the damage to Disbrowe-Bear's vehicle was consistent with the witness account.
Brent Disbrowe-Bear pleaded guilty to falsely reporting that his vehicle was struck by another motor vehicle while parked in a stall at his apartment complex.
There was damage to the passenger front bumper.
According to MPI's Special Investigation Unit, a witness saw a vehicle collide with a snowbank and stop sign; the licence plate matched that of Disbrowe-Bear's vehicle.
MPI confirmed the damage to Disbrowe-Bear's vehicle was consistent with the witness account.
Ontario Court of Appeal reinstates statute-barred auto injury claim
The Ontario Court of Appeal has breathed new life into an auto injury claim that was defeated in a summary judgment because it was filed 14 months after the limitations period had expired.
The Appeal Court reinstated the action on the basis that the motion judge that dismissed the matter failed to consider the $15,000 statutory deductible from general damages as a factor in the discoverability of the claim.
In Antonia (Tami) Everding and Ljutvo Skrijel, Everding was the front-seat passenger in a low-speed collision in May 2000. She experienced immediate pain and underwent various post-accident therapies.
She consulted a lawyer in May 2001. She was then advised that for a soft-tissue injury, she had no case unless there was some visible or objective injury.
Everding's family doctor advised her in May 2004 that she suffered from a chronic pain condition.
An MRI scan was recommended in September 2005. Conducted in May 2006, the MRI revealed a disc bulge at two locations.
The MRI provided objective proof she had a permanent injury that might have exceeded the $15,000 statutory deductible. She consulted her lawyers, who then launched her claim in 2007.
The defendant moved for summary judgment to dismiss the case, arguing the claim was statute-barred as of May 2006. The defendant said the plaintiff knew or ought to have known that she had a valid claim when she was diagnosed with chronic pain in May 2004.
The lower court agreed, but the Appeal Court said the motions judge should have considered first whether the claim would have exceeded the $15,000 threshold.
Counsel for the defendant argued the issue of whether or not the claim would have exceeded the $15,000 deductible "should not be considered a condition precedent to the discoverability of a claim that is potentially significant enough" to override the limitations spelled out in the Insurance Act.
"I reject this submission," Ontario Court of Appeal Justice Kathryn Feldman wrote for the court. Feldman cited with approval the Ontario Superior Court decision in Voisin v. Hartin:
"The rationale underlying the discoverability principle is that the law ought not to preclude an action before a person is able to sue on it. In my view, this rationale requires me to take into account the effect of the $10,000 [now $15,000] requirement.
"It would be fundamentally unfair to require the plaintiff to bring an action in which he could not expect to recover anything because his claim could not surpass the $10,000 exemption.
The Appeal Court reinstated the action on the basis that the motion judge that dismissed the matter failed to consider the $15,000 statutory deductible from general damages as a factor in the discoverability of the claim.
In Antonia (Tami) Everding and Ljutvo Skrijel, Everding was the front-seat passenger in a low-speed collision in May 2000. She experienced immediate pain and underwent various post-accident therapies.
She consulted a lawyer in May 2001. She was then advised that for a soft-tissue injury, she had no case unless there was some visible or objective injury.
Everding's family doctor advised her in May 2004 that she suffered from a chronic pain condition.
An MRI scan was recommended in September 2005. Conducted in May 2006, the MRI revealed a disc bulge at two locations.
The MRI provided objective proof she had a permanent injury that might have exceeded the $15,000 statutory deductible. She consulted her lawyers, who then launched her claim in 2007.
The defendant moved for summary judgment to dismiss the case, arguing the claim was statute-barred as of May 2006. The defendant said the plaintiff knew or ought to have known that she had a valid claim when she was diagnosed with chronic pain in May 2004.
The lower court agreed, but the Appeal Court said the motions judge should have considered first whether the claim would have exceeded the $15,000 threshold.
Counsel for the defendant argued the issue of whether or not the claim would have exceeded the $15,000 deductible "should not be considered a condition precedent to the discoverability of a claim that is potentially significant enough" to override the limitations spelled out in the Insurance Act.
"I reject this submission," Ontario Court of Appeal Justice Kathryn Feldman wrote for the court. Feldman cited with approval the Ontario Superior Court decision in Voisin v. Hartin:
"The rationale underlying the discoverability principle is that the law ought not to preclude an action before a person is able to sue on it. In my view, this rationale requires me to take into account the effect of the $10,000 [now $15,000] requirement.
"It would be fundamentally unfair to require the plaintiff to bring an action in which he could not expect to recover anything because his claim could not surpass the $10,000 exemption.
Sunday, June 20, 2010
Will Your Insurance Cover That Freak Accident?
Floods and earthquakes require special policies, but a lot of odd mishaps are paid for by homeowner's and auto insurance.
Seven Freak Accidents Where Insurance Paid Off
Stuff happens. That's why you need insurance--for your home, auto and an umbrella liability policy to protect you if you're sued. The good news is that homeowner's and auto insurance covers more than you might think. It's not just the obvious perils to your property, like fire, lightning, wind, hail or run-of-the-mill fender benders. Insurance can also pay off when the really unexpected happens.
Are you covered if a guest falls off your roof deck? If your punch bowl tips over into your grand piano? If the frisky terrier in your lap leads you to drive distracted? For details on these and other freak accidents where insurance did pay off, click here.
Don't be afraid to ask directly, before you face a loss. Understandably, hearing about someone else's misfortune gets folks to wondering. "Customers call in to question unusual incidents all the time, saying, 'My friend just had a loss,' and asking, 'Would I be covered?'" reports Mario Morales, an underwriting manager with MetLife ( MET - news - people ) Auto & Home. Insurers and insurance agents don't mind such questions. "The best thing an insured can do is to contact an agent or company and periodically go over the coverage," Morales says
While you're asking about the weird stuff, undertake a broader review of your coverage. If you're like many consumers, you may well be paying too much or paying for the wrong sorts of coverage.
You could well be underinsured in some areas. (Say, the replacement coverage for your home is pegged too low, or you carry too small an umbrella policy.) Meanwhile, you could be overinsured for other risks. (Say, you have too much coverage on the contents of your home, or your deductibles are too low.) For 10 ways to save on insurance, click here.
When doing an insurance review, make sure you take note of any changes in coverage since you first bought your policy. Companies have to make customers aware of any contractual changes--that's why you get all those extra notices about coverage limits along with your renewal each year. But if you're like many busy folks, you may have filed those notices away (in the insurance file or the circular one) without reading the fine print.
When you do your review, be aware that there are two big perils that require special coverage beyond basic homeowner's insurance: floods and earthquakes. You don't live in a flood-prone area? You may still want flood insurance. One reason: damage caused by water seeping in through the concrete in your basement probably isn't covered unless you have flood insurance. (Note, however, that if your basement floods because a frozen pipe bursts or wind-driven rain comes into your house after your windows are blown, the water damage would be covered under standard homeowner's insurance.) Most policies have limited--if any--coverage for earthquake damage, unless you buy add-on earthquake coverage.
A common instance where people assume they're covered, but they're not, is if there's a large or total loss of their home and new building codes drives up the cost of building a replacement. Most policies provide no or limited coverage for this unless you have what's called "law and ordinance coverage"--an add-on that's especially important if you have an older home.
Another situation Morales says MetLife gets lots of confused
calls about is trees. If a neighbor's tree falls in your yard and hits your house or an outbuilding, the damage and the tree removal is typically covered. But if the tree just lands Wear and tear losses are your problem, too. Example: You buy a rider to cover an expensive painting and then you hang your masterpiece on a wall facing West. Unfortunately, you don't have UV protection on your windows and the painting fades. That wouldn't be covered, warns Daniel Glunt, chief executive and founder of Fort Point Insurance Services in San Francisco.
Here's another thought to keep in mind when you do your insurance review. More than one in six drivers don't have auto insurance, estimates the nonprofit Insurance Research Council in Malvern, Pa. If one of these uninsured folks hit you, you'd better have uninsured motorist coverage, required in some but not all states. Make sure you have uninsured motorist coverage on your umbrella policy, too. That helped a good Samaritan in San Francisco who, after helping a child trying to cross a country highway, was hit by an uninsured motorist. His policy paid out $1 million, says Glunt.
Glunt recommends high-net-worth folks carry $5 million in umbrella liability coverage to protect their personal assets should something tragic happen. His firm has handled big insurance payouts for clients, including millions to the family of a teenager paralyzed after diving into the shallow end of a client's pool, and millions to a successful entrepreneur whom a client hit in a crosswalk when driving down a busy street. In such cases, having the insurer on the hook means help with legal defense costs, too.
Remember President Clinton's defense of Paula Jones' defamation and sexual harassment lawsuit? State Farm and a subsidiary of Chubb helped pay for his defense because Jones alleged "bodily injury" and Clinton had personal liability umbrella policies; he ultimately settled, with part of the cost paid by Chubb. As a result, most carriers now exclude sexual harassment on personal umbrella policies. So check your policy as well as your baser instincts.
Seven Freak Accidents Where Insurance Paid Off
Stuff happens. That's why you need insurance--for your home, auto and an umbrella liability policy to protect you if you're sued. The good news is that homeowner's and auto insurance covers more than you might think. It's not just the obvious perils to your property, like fire, lightning, wind, hail or run-of-the-mill fender benders. Insurance can also pay off when the really unexpected happens.
Are you covered if a guest falls off your roof deck? If your punch bowl tips over into your grand piano? If the frisky terrier in your lap leads you to drive distracted? For details on these and other freak accidents where insurance did pay off, click here.
Don't be afraid to ask directly, before you face a loss. Understandably, hearing about someone else's misfortune gets folks to wondering. "Customers call in to question unusual incidents all the time, saying, 'My friend just had a loss,' and asking, 'Would I be covered?'" reports Mario Morales, an underwriting manager with MetLife ( MET - news - people ) Auto & Home. Insurers and insurance agents don't mind such questions. "The best thing an insured can do is to contact an agent or company and periodically go over the coverage," Morales says
While you're asking about the weird stuff, undertake a broader review of your coverage. If you're like many consumers, you may well be paying too much or paying for the wrong sorts of coverage.
You could well be underinsured in some areas. (Say, the replacement coverage for your home is pegged too low, or you carry too small an umbrella policy.) Meanwhile, you could be overinsured for other risks. (Say, you have too much coverage on the contents of your home, or your deductibles are too low.) For 10 ways to save on insurance, click here.
When doing an insurance review, make sure you take note of any changes in coverage since you first bought your policy. Companies have to make customers aware of any contractual changes--that's why you get all those extra notices about coverage limits along with your renewal each year. But if you're like many busy folks, you may have filed those notices away (in the insurance file or the circular one) without reading the fine print.
When you do your review, be aware that there are two big perils that require special coverage beyond basic homeowner's insurance: floods and earthquakes. You don't live in a flood-prone area? You may still want flood insurance. One reason: damage caused by water seeping in through the concrete in your basement probably isn't covered unless you have flood insurance. (Note, however, that if your basement floods because a frozen pipe bursts or wind-driven rain comes into your house after your windows are blown, the water damage would be covered under standard homeowner's insurance.) Most policies have limited--if any--coverage for earthquake damage, unless you buy add-on earthquake coverage.
A common instance where people assume they're covered, but they're not, is if there's a large or total loss of their home and new building codes drives up the cost of building a replacement. Most policies provide no or limited coverage for this unless you have what's called "law and ordinance coverage"--an add-on that's especially important if you have an older home.
Another situation Morales says MetLife gets lots of confused
calls about is trees. If a neighbor's tree falls in your yard and hits your house or an outbuilding, the damage and the tree removal is typically covered. But if the tree just lands Wear and tear losses are your problem, too. Example: You buy a rider to cover an expensive painting and then you hang your masterpiece on a wall facing West. Unfortunately, you don't have UV protection on your windows and the painting fades. That wouldn't be covered, warns Daniel Glunt, chief executive and founder of Fort Point Insurance Services in San Francisco.
Here's another thought to keep in mind when you do your insurance review. More than one in six drivers don't have auto insurance, estimates the nonprofit Insurance Research Council in Malvern, Pa. If one of these uninsured folks hit you, you'd better have uninsured motorist coverage, required in some but not all states. Make sure you have uninsured motorist coverage on your umbrella policy, too. That helped a good Samaritan in San Francisco who, after helping a child trying to cross a country highway, was hit by an uninsured motorist. His policy paid out $1 million, says Glunt.
Glunt recommends high-net-worth folks carry $5 million in umbrella liability coverage to protect their personal assets should something tragic happen. His firm has handled big insurance payouts for clients, including millions to the family of a teenager paralyzed after diving into the shallow end of a client's pool, and millions to a successful entrepreneur whom a client hit in a crosswalk when driving down a busy street. In such cases, having the insurer on the hook means help with legal defense costs, too.
Remember President Clinton's defense of Paula Jones' defamation and sexual harassment lawsuit? State Farm and a subsidiary of Chubb helped pay for his defense because Jones alleged "bodily injury" and Clinton had personal liability umbrella policies; he ultimately settled, with part of the cost paid by Chubb. As a result, most carriers now exclude sexual harassment on personal umbrella policies. So check your policy as well as your baser instincts.
Tuesday, June 15, 2010
Ontario releases new Minor Injury Guideline, a key feature of proposed auto reforms
Ontario's insurance regulator, the Financial Services Commission of Ontario (FSCO), has posted its new Minor Injury Guideline (MIG), a key pillar of the province's proposed new auto insurance reform package.
The MIG will apply to accidents that occur on or after Sept. 1, 2010, when the province's new auto insurance reforms are introduced.
The MIG defines a "minor injury" as "a sprain, strain, whiplash associated disorder, contusion, abrasion, laceration or subluxation [a partial but not complete dislocation of the joint], and any clinically associated sequelae [symptoms following on these injuries]."
A whiplash-associated disorder is further described as a whiplash injury that "does not exhibit objective, demonstrable, definable and clinically relevant neurological signs and does not exhibit a fracture in or dislocation of the spine."
The entire MIG, including more complete definitions, can be found at: http://www.fsco.gov.on.ca/english/pubs/bulletins/autobulletins/2010/a-10_10.asp
Benefits for minor injuries as defined in the new MIG are subject to a $3,500 limit.
The new MIG calls for health care providers to focus on "functional restoration," which "refers to an approach in which the health practitioner is oriented toward function and to the delivery of interventions that help the insured person to reduce or manage his/her pain and associated psycho-social symptoms."
The MIG says treatment should be "focused on what the insured person needs to do in order to function at his/her pre-accident level in his/her home and work environment."
The MIG goes on to note impairments will not fall under the guideline "if the insured person's impairment is predominantly a minor injury, but based on compelling evidence provided by his or her health practitioner, the insured person has a pre-existing medical condition that will prevent the insured person from achieving maximal recovery from the minor injury if he or she is subject to the $3,500 limit..."
The MIG says only in "extremely limited instances" would a pre-existing condition exclude a person's impairment from the guideline. "The existence of any pre-existing condition will not automatically exclude a person's impairment from this [guideline]," the MIG says. "It is intended and expected that the vast majority of pre-existing conditions will not do so."
Treatments or monitoring are to be provided in three, four-week blocks of time. The health practitioner's fees for each block of time are fixed.
The MIG will apply to accidents that occur on or after Sept. 1, 2010, when the province's new auto insurance reforms are introduced.
The MIG defines a "minor injury" as "a sprain, strain, whiplash associated disorder, contusion, abrasion, laceration or subluxation [a partial but not complete dislocation of the joint], and any clinically associated sequelae [symptoms following on these injuries]."
A whiplash-associated disorder is further described as a whiplash injury that "does not exhibit objective, demonstrable, definable and clinically relevant neurological signs and does not exhibit a fracture in or dislocation of the spine."
The entire MIG, including more complete definitions, can be found at: http://www.fsco.gov.on.ca/english/pubs/bulletins/autobulletins/2010/a-10_10.asp
Benefits for minor injuries as defined in the new MIG are subject to a $3,500 limit.
The new MIG calls for health care providers to focus on "functional restoration," which "refers to an approach in which the health practitioner is oriented toward function and to the delivery of interventions that help the insured person to reduce or manage his/her pain and associated psycho-social symptoms."
The MIG says treatment should be "focused on what the insured person needs to do in order to function at his/her pre-accident level in his/her home and work environment."
The MIG goes on to note impairments will not fall under the guideline "if the insured person's impairment is predominantly a minor injury, but based on compelling evidence provided by his or her health practitioner, the insured person has a pre-existing medical condition that will prevent the insured person from achieving maximal recovery from the minor injury if he or she is subject to the $3,500 limit..."
The MIG says only in "extremely limited instances" would a pre-existing condition exclude a person's impairment from the guideline. "The existence of any pre-existing condition will not automatically exclude a person's impairment from this [guideline]," the MIG says. "It is intended and expected that the vast majority of pre-existing conditions will not do so."
Treatments or monitoring are to be provided in three, four-week blocks of time. The health practitioner's fees for each block of time are fixed.
Tuesday, June 8, 2010
Subscribe to:
Posts (Atom)