Social Networking, Meet Underwriting
Our esteemed social networking guru, Craig Beattie, recently circulated a blog posting that he found.
It describes an internet company, Social Intelligence, which monitors social networks to help companies with hiring decisions. Their data mining tool collects information from the major sites looking for behavior-based information about job applicants, and summarizes what is found in a report. It uses only publically shared data, and includes a review by humans to eliminate any “false positives.” There is also a service for continual monitoring of existing employees.
According to the blog posting, the company makes the point that with the emergence of social networks, shareholders will expect companies to use such services to evaluate new and existing hires and reduce the liability of the company from lawsuits, damage to reputation, etc.
Celent has not reviewed this company or its solution. However, in discussing what this approach might mean from an insurance perspective, several questions arose:
- Will such monitoring be considered a mainstream risk management technique one day?
- Would an insured using such a tool be rated a lower risk than one that does not?
- Should the shareholders of an insurance company reasonably expect the underwriting process to include the monitoring of social networking sites, especially for the general liability, disability and workers compensation lines of business?
- In the past, such data mining has been blocked by regulators based on privacy issues, but if all this information is willingly made public will those objections still be valid?
Social networking, meet underwriting.
This blog has been reprinted with permission from Celent.
It originally appeared on Insurance Networking News.