Social media is continuing to play a growing role in the insurance industry. The practice of scouring a consumer’s Facebook or Twitter page is already being used by many insurance investigators in the country, but the process may soon become automatic, making social media data a major factor in determining the outcome of claims and the price of insurance coverage. Making the matter more alluring for insurers is the fact that regulatiors throughout the nation have not yet established guidelines on how social media data can be used in terms of insurance.
Social networking sites like Facebook and Twitter have successfully created a sense of security for many people. Privacy is rarely at the forefront of a person’s mind when they are sharing details of their life with friends on the Internet. A good portion of the time, many Facebooker’s have lax privacy settings, making it even easier to obtain information that can be found by anyone.
A report from Celent, a research firm based in Boston, Massachusetts, notes that most insurers use social media for advertising, with a growing number of companies making use of the medium in claims. Author of the report, Michael Fitzgerald, says that underwriting is soon be influenced by social media and that companies may start adopting the practice to price insurance within three years.