Online Reputation Insurance: A Solution to Privacy Violations?

Online data security continues to prove insufficient, whether it is Facebook hanging on to old photos or Path uploading users' address books to their servers. Can insurance redress the damage?

What's the Latest Development?

Visiting Stanford scholar Evgeny Morozov says that online reputation insurance could help prevent data leak scandals by compensating victims of privacy violations and give companies financial incentives to better protect user data. Online data security suffered another setback last week when Path, a popular social network, was caught uploading its users' address books onto their servers, making the information vulnerable to hacking. Facebook has demonstrated that simply deleting data from a user profile does not remove it from the host's servers.

What's the Big Idea?

How might online reputation insurance work? A large pool of policy holders would pay in a small amount each month and, when evidence of personal harm can be presented as the result of an illegal data leak, the victim is entitled to compensation. Since few people are truly harmed as a result of privacy violations, the sums of money granted could be large. An advantage of the an insurance system is that it works well within the existing legal framework, rather than requiring a complex censorship infrastructure wanted by advocates of the 'right to be forgotten'.

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