UK Data Protection Bill update creates uncertainty for big data in insurance

New regulation poses questions and risks for insurers looking to use consumer data and analytics in their pricing processes.

UK Data Protection Bill update creates uncertainty for big data in insurance

This is according to GlobalData Financial Services. 

The UK’s Data Protection Bill is set to be modernized to include protection for consumers on topics such as internet history, social media, and DNA, as the original bill was passed in 1998. It will be published when Parliament returns from its summer recess in September, and is based on the EU’s General Data Protection Regulation.

Big data and analytics are becoming increasingly essential to insurers in pricing and tailoring policies for customers, but this emerging trend faces some ambiguity. Storing vast amounts of personal data will present an increased risk as the cost of being breached is soaring, to go alongside very damaging reputational damage. The fines for businesses that lose customer data following a cyber attack are set to rise to as much as £17m, or 4% of global turnover, from a previous maximum of £500,000, with the reporting of any incident becoming mandatory.