Return of the zip code drama as retailers battle with insurers

      Comments Off on Return of the zip code drama as retailers battle with insurers

Return of the zip code drama as retailers battle with insurersThe zip code drama is back again, but this time the battle is between retailers and insurers. In California, where earlier this year the Supreme Court ruled that obtaining zip codes from consumers at checkout violated state privacy statutes, two companies are now battling their insurance company, claiming that their policies should cover the defense costs.

Hartford, the insurance company in question, claims that they should not have to pay the claims because the liability policies do not provide coverage for privacy violations. This is an exclusion that was added to many insurance policies in the early 2000s after coverage disputes arose from a U.S. law that bans sending unsolicited advertisements to fax machines. Retailers may argue that they were not using the zip codes to infringe on their customers’ privacy.

If Hartford is forced the pay the claims, the case could set a very expensive precedent for insurance companies in California and beyond, as more and more states follow suit. The case is a perfect example of why clearly worded and up-to-date policies, which take into account evolving technologies and privacy issues, are essential for both insurers and insureds.

See the full story on www.programbusiness.com

Share