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How Much Money is your Freedom and Privacy Worth?

April 19, 2013
Chris Garlasco, Owner & Managing Partner - Founders Insurance Group

Chris Garlasco, Owner & Managing Partner – Founders Insurance Group

Unless you have been living on a deserted island in the Pacific, it would be hard to miss the explosion of technology that has been taking place over the past few years. A big part of this explosion has been related to how we record and communicate information. One doesn’t have to be that old to have witnessed generations of new technology appear and sometimes disappear right before our eyes. It seems like just yesterday that we were kids watching black and white television, and in my case, the Dark Age prior to cable. In the case of my mother, she thinks of it in terms of pre-SONY DSCtelevision. At the same time we have more than one generation that doesn’t know what life was like without a handy cell phone. We even have a generation on the rise that knows nothing of the days prior to Facebook. In-between my mother’s generation and today’s youth, we saw the beginning of the PC, the fax machine, a GPS, tablets, e-readers, smart phones, and of course, the internet. The actual list is longer than could ever be presented in this forum.

When it comes to today, we can feel the power of our ability to share, transmit and store data like never before, yet at the same time, we all get a sense that we are just barely scratching the surface of what’s yet to come. We can remember when a “cloud” was something that gave us shade from the hot sun, not a warehouse full of data.

Like all technological advances, the potential for improving our society is often mirrored with the potential for misuse and abuse of the very technology that improves our lives. History is filled with examples of the benefits and misuse of new technology.

The thing that captures my attention in this current era is the speed at which this new technology is reaching the consumer. At the risk of sounding like an aging grandparent, I often wonder if it is all a bit too fast. The collection, use, and communication of information seem to be outpacing society’s ability to digest and review the long term effect of how we currently share information. The rule of law seems to always be just one step behind and I fear that the illusion of privacy is simply that…….an illusion.

EBay routinely monitors its community’s use of communication for misuse. Most of us have experienced something that we reviewed on line showing up later in the form of advertisements or pop up screens. It currently is being debated in Washington as to how private your emails are when it comes to the IRS. I often wonder exactly how private are your privacy settings on your favorite social media site?

Certainly there are far more qualified people to discuss and write about some of the concerns I have mentioned. So the question is, why am I writing about this and what does it have to do with your insurance?

In addition to the threats to your privacy, there are an emerging number of people that are willing to sacrifice their privacy in lieu of saving some money. So the question that I have for each person reading this diatribe is, “how much privacy and possibly how much freedom are you willing to sacrifice in an effort to save a few dollars?” What is your privacy worth to you?

There are two instances that immediately come to mind in the insurance world. The first centers around the new devices that can be placed in your car to monitor your driving habits. The one that is likely the most well-known is “Snapshot” from Progressive Insurance Company. But they are not alone. Companies like Travelers and Safeco (A Liberty Mutual Company) offer similar products and with the perceived success of Snapshot, it is safe to say that other companies will follow suit. There has also been some discussion of requiring a “black box” type device in your car to allow police departments to gather data at the time of an accident. Some car companies may already be doing it. Of course, like the insurance devices, the idea is to keep you safe and keep you or society from overpaying. However, while the roads are in the public domain, your car is private property.

There was an outcry recently over the national drugstore chain, CVS, gathering information on their employee’s personal health as part of a “wellness” program. Of course CVS claims that this isn’t required, but a hefty surcharge ($600) on the employee’s health insurance will be levied for those that don’t participate. With the advent of the Affordable Care Act, it is reasonable to believe that this is just the beginning of a new trend. Those of us that live near New York City, and many of us that are not, are familiar with the battle over soda sizes. People took sides in the heated debate which often led to one group claiming that it didn’t want to cover the cost of another group’s lifestyle. The Affordable Care Act reaches directly or indirectly to the health insurance and health care of every American.

Our ability to mine data and track behavior is at an all-time high and we are just at the beginning of what may be a long term discussion (or battle depending on your point of view) In the case of your auto insurance, which already asks for your credit information, or your health insurance, Americans are increasingly going to be asked to decide, “How much extra money is your private information or freedom worth?”

It is said that everyone has a price. I know what mine is, do you?

Have a great day!

Chris Garlasco

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