"Physician, heal thyself" is an expression that many people use to criticize a lack of standards among groups or organizations that are charged with enforcing those same standards among others. And a paraphrase that applies to the insurance business is "insurer, protect thyself."
It turns out that for a business that is so conscious — and conscientious — of all things involving risk, the insurance industry neglects its own risk, especially when it comes to data breaches. That neglect has cost companies millions in court settlements and regulatory fines.
|You've been breached
Among the insurance companies that have paid a price for failing to prevent data breaches is Nationwide Mutualand its subsidiary, Allied Property and Casualty Insurance Company. Nationwide is on the hook for a more than $5 million fine resulting from a 2012 data breach that divulged details on 1.27 million customers.
Also on the firing line are CareFirst, which is the target of a class-action lawsuit for a 2014 data breach that affected more than one million people, and Horizon Blue Cross Blue Shield, which is in the midst of class-action suit over a 2013 breach that hit 800,000 victims when their data was accessed.
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