Insurance Coverage Considerations for Privacy Class Action Lawsuits in This Technology Driven World

In this article, Gretchen Hoff Varner, Darren Teshima, and Hakeem Rizk examine the growing wave of privacy class action lawsuits targeting companies for alleged misuse or unauthorized sharing of personal data, often under statutes such as the CCPA, BIPA, and wiretapping laws. They begin by outlining recent litigation trends, including suits involving tracking technologies, biometric data, and artificial intelligence, and highlight the significant financial and reputational risks these cases pose. The authors then provide a high-level discussion of five key insurance coverage considerations for companies facing such lawsuits: evaluating all potentially applicable policies, understanding the value of defense cost coverage, complying with notice requirements, consulting experienced coverage counsel, and securing adequate privacy risk coverage. They conclude by emphasizing the importance of proactively negotiating exclusions and investing in robust cyber and privacy insurance to mitigate exposure as privacy litigation and regulatory scrutiny continue to escalate in today’s technology-driven world.