Consumer information Privacy Regulation

Question 1

Consumer information, privacy regulations

Answer 1

The South Carolina Consumer Information Privacy Regulation is based on the federal Gramm-Leach-Bliley Act (GLB). This regulation controls how insurance companies and their producers (agents) handle and protect consumers’ non-public personal health information and personal financial information.

The federal GLB Act mandates that financial institutions, including insurance providers, clearly explain their practices for sharing customer information and actively protect sensitive consumer data.
South Carolina applies these federal protections specifically within the insurance sector, ensuring customers’ private information is safeguarded.

Question 2

Scope of regulation
(This regulation applies to all entities licensed by South Carolina’s insurance department. Specifically, it:)

Answer 2

1. Requires Notice of Privacy Policies
   Insurance providers must inform customers about their privacy policies and practices clearly, particularly when a consumer seeks insurance or insurance-related services.
2. Describes Conditions for Disclosure
   Clearly specifies circumstances under which a licensee (insurance company or agent) can share non-public personal health and financial information with affiliates and non-affiliated third parties.
3. Provides Opt-out Methods
   Consumers must be provided methods to prevent (opt-out) insurance companies from disclosing their personal information to others.
4. Ensures Clarity and Significance of Notices
   Notices provided must be straightforward, easy to understand, and clearly communicate their purpose, highlighting the importance of privacy and data protection.

Question 3

Initial Notice
(When collecting or using nonpublic, personal financial, or health information, an insurer, or producer is required to:

Answer 3

1, notify individuals about the insurance or producers, privacy policies and practices

2. Describe conditions, under which an insurer or producer may disclose this information to affiliated companies and nonaffiliated third parties.
3. Pride methods for individuals to prevent an insurance producer from disclosing this information (opt out)
4. Notice must be in writing, but can be provided electronically if the customer agrees
5. Provide the notice over the phone or Orlly Explaining the notice is not adequate.
6. Cannot provide policy numbers to nonaffiliated third parties for telemarking, direct mail or other marketing through electronic mail to the consumer.

Question 4

Annual Notice Required

Answer 4

An insurance provider (insurer) or agent (producer) must inform current customers of their privacy policies and practices at least once each year.
They must also provide an updated privacy notice whenever their privacy policy is revised or when a customer purchases a new insurance product.

Question 5

Notice of right to opt out required

Answer 5

Insurers or producers are obligated to inform customers about their right to opt out, which allows customers to prevent the disclosure of their nonpublic personal financial information to nonaffiliated third parties.
Customers must be clearly notified that they have this choice, and if they choose to opt out, their information cannot be shared in ways that are otherwise legally allowed.

Question 6

Exceptions to the Requirement for Opt-Out Notice

The Exceptions to Requirement for Opt-Out Notice specify certain situations when insurers or producers are not required to inform customers about their right to opt-out before disclosing personal financial information to nonaffiliated third parties. These exceptions include disclosures necessary to:

Answer 6

1. Carry out transactions that a customer explicitly authorized or requested.
2. Prevent insurance fraud or unauthorized transactions.
3. Resolve customer disputes or inquiries effectively.
4. Comply with federal, state, or local legal requirements or regulations.
5. Inform individuals with a legal interest related to the customer (e.g., lienholders).
   Provide information to fiduciaries or representatives managing the customer’s interests.
6. Assist the insurer’s or producer’s legal counsel, accountants, or auditors with professional responsibilities.
7. Share information with law enforcement or regulatory agencies such as the Insurance Department, for investigative or oversight purposes.
8. These exceptions exist because such disclosures are essential to routine business operations, compliance with laws, or protection against fraud, and do not require consumer permission.