NU Online News Service, Jan. 30, 5:34 p.m. – The American Council of Life Insurers, Washington, and four property-casualty trade groups filed a suit in Vermont state court to overturn a privacy regulation put in place by the Vermont Department of Banking, Insurance, Securities & Health Care Administration.
The property-casualty trades include the Alliance of American Insurers, Downers Grove, Ill.; the American Insurance Association, Washington; the National Association of Independent Insurers, Des Plaines, Ill.; and the National Association of Mutual Insurance Companies, Indianapolis.
The suit, filed in Vermont state superior court in Washington County, challenges an opt-in regulation scheduled to take effect Feb. 15. The regulation requires insurers to get permission from consumers before sharing nonpublic personal information with non-affiliates.
Insurance groups want the Vermont department to adopt an opt-out requirement, which would require insurers to give consumers a chance to opt out of information-sharing arrangements.
The suit contends that the Vermont department lacks the statutory authority to issue the opt-in regulation and that it breached the barrier separating executive and legislative powers. The plaintiffs are seeking a declaratory judgment and an order to prevent the department from enforcing the regulation.
The department has argued that it has the authority to enforce the regulation and is seeking to establish standards similar to the requirements it imposes on banks.