Auto Insurers Are Watching Social Media Posts


You’ve probably read about people losing their jobs or blowing a job interview because of indiscrete Facebook posts. But employers and HR departments aren’t the only people scanning social media sites for personal data. Now the car insurance industry may be reading your posts, too.

According to an October 13 post on Insurance Journal, insurance investigators are already checking out social media sites for evidence of potential auto claim fraud. Hard to believe (well, maybe not THAT hard) but people actually brag about over-reporting damages and faking car accidents for bogus claims against auto insurance companies. Courts are now accepting that information as admissible evidence.

As the practice proves successful and in the face of rising claims’ costs, count on insurers to escalate their social media scrutiny. With 65% of adult Internet users now engaging in social media, posts can be a rich source of data for underwriters  –  and not just for car insurance. Eventually, providers of all forms of business and personal insurance will be reviewing applicants’ social media activity to determine risk exposure and assign premiums.

According to a recent report from Celent, a leading analyst firm, legal and ethical issues are the biggest obstacles to the wider use of social media to underwrite and rate policyholders. Once those issues are
worked out and the practice is cleared by state regulators, reviewing social media activity will join reviewing credit reports, motor vehicle records and MIB fraud reports as an acceptable way to determine your insurance-worthiness.

The Celent report predicts the practice will be widely adopted across the entire spectrum of insurance products within the next 3 years or so. Until then, many insurers may opt to soft-launch the procedure by asking permission to mine your social media data in exchange for an attractive discount, much the way they’re currently doing with pay-as-you-drive insurance programs like Progressive’s Snapshot and Allstate’s Drive Wise.

Until then, consider yourself warned and don’t go tweeting about drag racing down Main Street.

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