Penalty Amount
$11,300,000
Consumers Affected
120,000
New York Attorney General Letitia James and New York State Department of Financial Services (DFS) Superintendent Adrienne Harris settled with auto insurers GEICO and Travelers for $11.3 million combined over data breaches that exposed over 120,000 New Yorkers’ personal information, including driver’s license numbers and dates of birth. The breaches stemmed from insufficient data security controls, allowing hackers to steal information and file fraudulent unemployment claims during the COVID-19 pandemic. The settlements require the companies to pay penalties and implement enhanced cybersecurity measures including comprehensive information security programs, data inventories, and improved access controls.
GEICO will pay $9.75 million and Travelers will pay $1.55 million in total penalties of $11.3 million. Both companies must implement comprehensive information security programs, maintain data inventories of private information, adopt reasonable authentication procedures, implement logging and monitoring systems for suspicious activity, and enhance threat response procedures. GEICO must additionally conduct a comprehensive cybersecurity risk assessment and penetration testing with an action plan to address gaps, while Travelers must review systems, assess access controls, and improve protections for nonpublic personal information (NPI).
In-house legal teams should review all vendor agreements with entities handling personal or nonpublic information to ensure robust cybersecurity requirements are included. Clauses should mandate multifactor authentication for access to sensitive systems, comprehensive information security programs, regular data inventories, and logging/monitoring systems for suspicious activity. Contracts should require vendors to comply with applicable cybersecurity regulations (e.g., DFS Cybersecurity Regulation for New York financial institutions) and conduct periodic risk assessments and penetration testing. Breach response clauses should require prompt detection and notification of breaches, and audit rights should be included to verify compliance with security requirements. For vendors handling nonpublic personal information (NPI), explicit access control and safeguard requirements must be added.
Entity
Government Employees Insurance Company (GEICO) and The Travelers Indemnity Company (Travelers)
Industry
InsuranceOfficial Press Release
https://ag.ny.gov/press-release/2024/attorney-general-james-and-dfs-superintendent-harris-secure-113-million-auto
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New York Attorney General Enforcement Page
https://ag.ny.gov/press-releases
"the Government Employees Insurance Company (GEICO) and The Travelers Indemnity Company (Travelers)"
"secured $11.3 million in penalties from two auto insurance companies, the Government Employees Insurance Company (GEICO) and The Travelers Indemnity Company (Travelers)"
"GEICO will pay $9,750,000 in penalties, of which OAG secured $4,750,000 and DFS secured $5 million. Travelers will pay $1,550,000 in penalties, of which OAG secured $350,000 and DFS secured $1,200,000."
"November 25, 2024"
"New York Attorney General Letitia James and New York State Department of Financial Services (DFS) Superintendent Adrienne A. Harris"
"today’s settlements"
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