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1996 Equifax/Harris Consumer Privacy Survey


A Message From Equifax

Introduction

Executive Summary: Major Findings Of The Survey


Since publication of our landmark consumer privacy survey in 1990, one of our primary objectives for each of the ensuing surveys has been to identify consumer attitudes about information privacy issues and then contribute that consumer voice to the ongoing and expanding dialogue on relevant public policy issues. Another less abstract objective has been to field a survey \ questionnaire the answers to which could provide valuable input to us and our customers as we consider new products, services, procedures or new applications for existing products.

We believe the 1996 Equifax-Harris Consumer Privacy Survey accomplishes both objectives. We are proud to present this report, the seventh in our series of national information privacy surveys conducted by Louis Harris & Associates.

This report is particularly timely, especially given recent legislative and regulatory actions, both domestic and international. First, on September 30th, 1996, in the waning moments of its second session, members of the 104th Congress passed legislation to reform the 1970 federal Fair Credit Reporting Act. The Consumer Credit Reporting Reform Act of 1996 is the culmination of more than five years of negotiation on the issue of fair information access, collection, and use. Acknowledged by consumer groups and business as an excellent piece of compromise legislation, the new law codifies much of what the credit industry had already voluntarily put into practice. Our series of surveys has consistently addressed the information privacy issues to determine what practices consumers find acceptable. This 1996 survey is no exception.

From a regulatory standpoint, the Federal Trade Commission has established consumer identification fraud as a key initiative. The FTC is working with a variety of organizations, including Equifax, in an effort to develop meaningful guidelines to deal with fraud detection, prevention, resolution and education issues. Similarly, the US Office of Consumer Affairs has established privacy and consumer fraud as its key focus for 1997. In the 1996 survey, consumers speak out about privacy and the kinds of information collection and use they find acceptable in the prevention of fraud. We believe this data will be useful in dealing with these public policy issues.

As an international corporation with operations or product presence in 35 countries, we are looking at developing a strong and meaningful set of global information privacy practices or information quality standards for each of the major international markets in which we operate. The European Union Directive requires third party countries to have an adequate standard of privacy protection in order for EU member states to allow transborder data flow. Accordingly, the 1996 survey also provides some insight useful to U.S.-based international businesses for dealing with the potential impact of the European Union Directive on transborder data flow.

Vocal groups in both Europe and the United States believe the United States should establish a central government office or separate data protection office for the enforcement of information privacy rules. The 1996 survey explores this topic, finding that the American public clearly prefers the existing U.S. system of privacy protection versus the establishment of a federal privacy commission of the type common in Europe. The debate about the "adequacy" of our privacy protection system will no doubt continue; we hope that our survey provides the means to add the consumer voice to that debate.

One theme of previous "Messages from Equifax" has been that a well-earned privacy reputation is a competitive edge, and Equifax has strived to earn that reputation. What is becoming increasingly more apparent is that no longer is privacy a competitive edge; rather, like product quality, it is a customer and consumer expectation.

Our survey, therefore, explores the degree to which consumers find acceptable a variety of business practices across a number of industries. For example, we examined consumer attitudes about the use of information in credit reporting, insurance prescreening, credit scoring, medical data for general healthcare research, as well as on the Internet and on-line services. Some of the findings may surprise you and will likely form the basis for further dialogue.

For their significant efforts in planning and executing this survey and subsequent report, we thank noted privacy expert Dr. Alan F. Westin, Columbia University professor and academic advisor to the survey; Dr. Joy Sever, Project Director, Louis Harris & Associates; and John Ford, Equifax Vice President and Project Director.

In sum, in sponsoring these studies, we seek to increase the understanding by information privacy stakeholders (business, consumers, government, academia, and the media) about the balance needed between the benefits of fair information use on the one hand with legitimate concerns about information privacy protection on the other hand. At Equifax, we accept as our responsibility the need to give careful attention to this data in developing our information policies and practices.

We hope you will find this report of value in pursuing your objectives.

NOTE: To obtain a copy of this survey or to suggest topics for a future Equifax-Harris survey, please write to:

Equifax Inc.
Privacy & External Affairs
1600 Peachtree Street, N.W.
Atlanta, Georgia 30309


The 1996 Equifax-Harris Consumer Privacy Survey marks the seventh in a series of surveys sponsored by Equifax Inc. and conducted by Louis Harris and Associates, Inc. This year's survey contains four main areas of inquiry beginning with an overall look at some general but key privacy issues. The first step is to set privacy protection in context among several other issues important to the American public. The report compares data gathered from the current and previous privacy surveys about the protection of privacy information as we head toward the millennium. The second area of inquiry explores the public's reactions to the use of information by businesses and medical professionals to help them make decisions or to advance research. As will be demonstrated in the results, the public's attitudes about the use of information varies according to the type of information being sought. A third focus centers on the Internet and the public's interest in various on-line services as well as their attitudes toward some very topical issues in the Internet arena. Finally, the survey provides a 1996 look at attitudes toward and behavior relevant to direct marketing. Also presented are the results of an initial gauging of the public's reactions to pre-approved offers of insurance.

The survey results are based on 1,005 telephone interviews conducted July 20-29, 1996. All interviewing took place with adults 18 years and older, representing a cross-section of adults in the 48 contiguous United States. Completed interviews were weighted according to age, education, race, and sex to bring the sample profile in line with the overall profile of adults in the 48 states. Appendix A provides a more detailed description of the methodology, including weighting and a profile of the sample. A copy of the questionnaire with top-line results can be found in Appendix B.

A Note on Interpreting the Results

The base for each question is the total number of respondents answering that question. All base sizes shown in the report are unweighted; percentages are weighted. An asterisk (*) in a table signifies a value of less than one-half percent (0.5%). A dash (-) represents a value of zero. Percentages may not always add to 100 because of computer rounding or the acceptance of multiple answers from respondents. Note that in some cases results may be based on small sample sizes (N less than 50). This is typically true when sub-group comparisons are made. Caution should be used in drawing any conclusions from the results based on these small samples.

Finally, reference numbers located in the bottom left corner of the tables and figures in this report refer to specific banners and tables in the full set of cross-tabulations.

The Equifax-Harris Consumer Privacy Survey 1996 is scheduled to be released October 31, 1996. The data from the survey can be accessed approximately six months after the survey is released from The University of North Carolina. Contact the Louis Harris Data Center, CB 3355, Manning Hall, Room 25, University of North Carolina, NC, 27599-3355; phone (919) 962-0517.

Public Release of Survey Findings

All Louis Harris and Associates, Inc. surveys are designed to adhere to the code of conduct of the Council of American Survey Research Organizations (CASRO) and the code of the National Council of Public Polls (NCPP). Because data from this survey will be released to the public, any release must stipulate that the complete report is also available.



1. Nearly two thirds of the public (65%) say "protecting the privacy of consumer information" is "very" important to them. This figure represents a significant four-point increase since 1995 when 61% expressed a similar feeling.

    • Although privacy is obviously important to a majority of the public, it is not the most important. "Controlling the cost of medical insurance" and "staying out of excessive debt," for example, are "very" important to 87% of the public.
    • More than three in four people (76%) say "reducing insurance fraud" is "very" important to them and 67% say the same of "controlling false advertising."

2. By a margin of two to one the public identifies actual experiences (either directly or indirectly) versus what they see or hear in the media as having the most influence on how they view business practices.

    • Nearly one in two people (49%) say their "own personal experiences" have the greatest influence on their attitudes about whether businesses today are handling personal consumer data in a proper way and another 17% say "the experiences of their friends" have had the greatest influence.
    • Nearly a third (32%) say "the media" have the most influence on their attitudes toward business practices.

3. The number of people who say they have been the victim of what they felt was an improper invasion of privacy remains virtually unchanged since 1991.

    • Today one in four people (24%) say they have personally experienced a privacy invasion. The figure was 25% in both 1995 and 1991, and 19% in 1978.

4. Recent survey figures suggest that the public may be becoming more optimistic in their outlook toward privacy protection in the year 2000.

    • In 1992, more than half of the public (55%) predicted that privacy protection in the year 2000 would get worse and only 12% thought it would get better. By 1995 only 41% of the public thought privacy protection would get worse and only 44% think so today.
    • Along with the drop in pessimism is a slight increase in optimism. In 1992, 12% of the public predicted privacy protection would get better. That figure increased to 16% in 1995 and is at 17% today.

5. By a margin of two to one, the public expresses a preference for the present system of privacy protection over a federal government Privacy Commission.

    • Compared to the 67% who say they would prefer the present system, only 28% say a federal government Privacy Commission would be best to protect the confidentiality of consumer information in the U.S.
    • The preference for the present system is also evident among a majority of privacy pessimists (63%) (i.e., those people who predict that privacy protection will get worse in the year 2000).

6. More than half the public feel it is very acceptable for businesses to use criminal record and motor vehicle information to help combat fraud. They are less enthusiastic, however, about letting businesses have access to medically-related information.

    • Among a list of six types of information, the type of information that appears to be most acceptable for use in preventing fraud and abuse is "criminal record information regarding an applicant's conviction for fraud" with 60% of the public indicating it would be "very" acceptable if businesses were to access this information in order to combat insurance fraud.
    • More than half (51%) also say it would be "very" acceptable to access "motor vehicle records to identify an applicant's dangerous driving history."
    • No more than four in ten people, however, feel it would be "very" acceptable to use "workers compensation data to verify an applicant's previous injuries or disabilities" (40%), or "health claims data to verify information the applicant supplied on an insurance application" (36%), or "medical records to verify any history of diseases, illnesses, and injuries asked about on the application" (31%).
    • The type of information the public seems most protective of is "pharmaceutical data to identify prescriptions the applicant is taking for medical conditions not listed on the application." Only 25% of the public feel it is "very" acceptable for businesses to use this information, while 26% feel it is "not at all" acceptable.

7. More than half of the public would find the practice of using their patient records for research at least "somewhat" acceptable, though only one in five would find this "very" acceptable.

    • Overall, 57% of the public would find the use of their patient records in medical research either "very" (18%) or "somewhat" (39%) acceptable.
    • Nearly one third (31%) say such use of their medical records would be "not at all" acceptable.

8. Judging by their anticipation of negative effects if businesses were not able to access credit reports, the majority of people appear to recognize the benefits that these reports provide to consumers.

    • Leading the list of five consequences of the inability to obtain credit reports is an "increase in the cost of credit to cover increases in bad debt" an outcome that 47% of the public think would be "very likely" to happen and another 44% think "probably" would happen.
    • Other outcomes considered "very likely" to happen include: "many businesses [asking for loans] to be secured" (42%), "many businesses [cutting] back on extending credit, to only the best customers" (34%), and "[taking] several weeks rather than several days to get a loan approved" (31%).
    • One in four (26%) also think that "people with good credit records would not get the lower costs that their records deserve" if accurate and relevant consumer credit reports were not available.

9. Most people appear to accept businesses' use of formulas from credit reporting companies that help to identify customers whose debt levels and spending patterns strongly suggest they will go bankrupt or become seriously delinquent.

    • One quarter of the public (24%) say the use of formulas from credit reporting agencies to assess the likelihood of bankruptcy is "very" fair.
    • The majority of the public (55%) think the use of bankruptcy formulas is "somewhat" fair.

10. At least half of the public express interest in on-line services related to obtaining credit reports and health-related information. Not surprisingly, the biggest predictor of interest is not simply computer use, but use of on-line services and the Internet.

    • Overall, 22% of the public would be "very" interested in a computer-based on-line service that would let them identify themselves with a special password, in order to receive on-line their latest credit report and another 29% would be "somewhat" interested. One third of on-line service users (33%) and 35% of Internet users say they would be "very" interested in such a service (compared to 19% of non-on-line service users and 18% of non-Internet users).
    • Half of the public (50%) say they would be interested in an on-line computer service providing information to choose physicians, hospitals, and health plans 16% say they would be "very" interested and 34% say they would be "somewhat" interested. Computer users (17%) especially those who use on-line services (25%) or access the Internet (24%) show greater interest than non-computer users (15%, 14%, and 14%, respectively, say they are "very" interested).
    • Overall, 17% of the public say they would be "very" interested in accessing health and wellness educational information on-line, and another 34% would be "somewhat" interested. On-line service users (25%), and people who access the Internet (24%) are among those most likely to say they would be "very" interested in the service.

11. Public opinion is divided regarding privacy protection on the Internet, with Internet users leaning toward greater privacy protection and less intervention on the part of the government.

    • Nearly half of the public agree that users should be able to visit Internet sites and use e-mail without having to give their real identities 21% agree "strongly," 27% agree "somewhat," and half disagree, with 21% disagreeing "somewhat" and 29% disagreeing "strongly." Among Internet users, however, the majority agree that this anonymity should exist 30% agree "strongly" and another 30% agree "somewhat."
    • When it comes to whether the government needs to be able to scan Internet messages and user communications in order to prevent fraud and other crimes, the public leans toward agreement with 32% agreeing "strongly" and 30% agreeing "somewhat." A difference of opinion is revealed, however, when Internet users are compared with non-users only 51% of Internet users agree that the government should be able to do this compared to 64% of non-users who think so.
    • The majority of the public (64%) disagree that providers of on-line services should be able to track the places users go on the Internet in order to send these users targeted marketing offers. An even greater proportion of Internet users (71%) disagree with 43% of them disagreeing "strongly."

12. The public appears to have made a notable shift over the past few years in how they regard mail offers received at their homes. Compared to 1991 and 1994 when nearly half of the public said they regard mail offers as a nuisance (46% and 47% respectively), less than four in ten (37%) say they feel that way today.

    • Complementing this finding is the increase in the percentage of people who say they rarely use mail offers but do not see them as a problem (38% felt this way in 1991, and 35% in 1994 compared to 43% who feel this way today).
    • There has also been a gradual but steady increase in the percentage of people who regard mail offers at their homes as a useful opportunity (6% felt this way in 1991, 10% in 1994, and 12% in 1996).
    • Only 7% of the public currently regard mail offers sent to their home as invasions of privacy. (In 1991 this figure was 9%; in 1994 it was 7%.)

13. The percentage of people who report being aware of any procedures that allow one to remove one's name from direct mail lists for catalogs, products, and services has remained constant from 1991 to the present at 44%.

    • The people most likely to report being aware of the procedures to have names removed from direct mail lists are the same people most likely to have ordered something in the past year. Overall, 52% of those who say they have ordered something in the past year also say they are aware of the procedures (v. 33% among those who have not ordered something in the past year).
    • Notably, only 29% of those people who consider mail offers an invasion of privacy are aware of the procedures that would allow them to remove their names from direct mail lists.

14. If a procedure were available to have one's name removed from all mailing lists, some mailing lists, or no mailing lists, three out of four people (73%) would elect to have their names removed from only some lists.

    • Assuming such a procedure were available, only 15% say they would have their names removed from all lists, while only 12% say they would have their names removed from no lists.
    • The corresponding figures in 1991 were 64% (for some lists), 22% (for all lists), and 13% (for no lists), demonstrating an increased desire to receive at least some direct mailings.
    • Even among the groups of people who have: experienced invasions of privacy, think of mail offers as invasions of privacy, think of mail offers as a nuisance, and who have not ordered in the past year majorities would still want to keep their names on some direct mail lists (69%, 64%, 73%, and 64%, respectively).

15. Most people feel the practice of compiling profiles of individual consumers' purchasing patterns and using this information to mail offers of goods and services to consumers who appear likely to be interested in these products is at least "somewhat" acceptable (66%); 11% feel it is "very" acceptable; 55% say it is "somewhat" acceptable.

    • Not surprisingly, the greatest support for purchase pattern profiling comes from people who feel mail offers are useful opportunities (24% v. 14% or less among people who do not view mail offers this way).
    • In contrast, 47% of the people who regard mail offers as invasions of privacy say that that consumer purchase pattern profiling is "not at all" acceptable.

16. Just over half the public would find the practice of sending pre-approved offers of insurance by mail "very" or "somewhat" acceptable when it comes to offers of automobile and other property insurance (52%) and life insurance (51%).

    • More than one in four, however, would find this practice "not at all" acceptable (26% for auto/property and 27% for life).
    • The figures do not change significantly when people are asked about the acceptability of using credit report information in order to qualify consumers for these pre-approved offers. With regard to auto and other property insurance, 55% of the public would find this practice "very" or "somewhat" acceptable. For life insurance, the corresponding figure is 45%.
    • When people are told that consumers who are not interested in receiving these pre-approved offers of insurance could have their names and addresses removed from these mailing lists, the percentage of people overall who would find it acceptable to use credit report information to qualify consumers for these pre-approved offers reaches 90% for automobile or other property insurance and 88% for life insurance.


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