Calif. DMV, Allstate Reach Agreement on Access to Confidential Records

Allstate Insurance Company has reportedly paid a fine of $1 million to the California Department of Motor Vehicles, and the company’s access to confidential DMV records was suspended until yesterday, as part of a settlement involving Allstate’s reported failure to adhere to state laws and regulations concerning access to and use of confidential records.

State audits conducted at seven Allstate claims offices throughout California reportedly determined that there was a failure to adequately monitor and regulate access to confidential DMV driver license and vehicle registration records.

Allstate has been in negotiations with DMV since their electronic access to information was inactivated on Jan. 16. Allstate has reportedly cooperated fully with DMV to ensure that their procedures will be acceptable for safeguarding confidential information that they may lawfully request from the Department.

Under the terms of the settlement agreement:

*Allstate paid a $1 million fine and reimbursed the DMV for attorney’s fees, costs related to the state audits, and will pay for additional audit costs over a four year probationary monitoring period.
*Allstate’s access to DMV records was suspended until March 17, 2003, and a further period of no access will be stayed provided that Allstate complies with all DMV regulations and State laws.
*Allstate has implemented comprehensive security reforms in its offices throughout the state that meet the DMV’s information security requirements.

DMV Director Steven Gourley noted, “These important reforms establish Allstate as a model for others to follow with respect to DMV security and confidentiality.”

“Allstate takes its obligation to safeguard the confidentiality of consumer information very seriously,” Terry Lewkoski, director for Allstate’s California claims operation, added. “We are committed to continue working with the DMV to ensure that we continue to strengthen our processes.”

Gourley confirmed that “the reforms put in place by Allstate are designed to ensure that there is neither a deliberate nor inadvertent breach of confidential DMV records, thereby protecting the public’s right to this confidentiality.”