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Do you want your insurance company to be able to find our how much you've been searching for coupons for unhealthy food like donuts? - 

What if you were up late one night, searching for some good online coupons for sweet treats like donuts or cake, and somehow that data was passed along to your insurance company, who then hiked up their rates?

That is just one example of the kinds of fears government officials and consumers alike have concerning online privacy. Today, the Obama administration has proposed a consumer privacy bill of rights to protect Internet users from having too much personal information exposed.

Tracking can have many benefits for companies, and even consumers -- who might enjoy the way, say, an ad for ice cream pops up if you search for "rocky road."

According to Chris Sumner at the Online Privacy Foundation, the problem is when such data collection is taken a step farther.

"You know if you're looking for a group discount on donuts," he cites as an example, "you'd expect it to be used in that way and not passed on to an insurance company that might say: Hey this guy likes donuts, could be a greater risk for heart disease or what have you."

One facet of this will be a national standard for a "do not track" button on websites. While many Internet browsers already have privacy options, like Firefox's "private browsing" or Google Chrome's "incognito" to name a few, the rules on this still aren't quite clear. Many Internet advertisers have not opted in to your decision to opt out, so they can still try to track you, even if your browser doesn't.

Marc Rotenberg directs the Electronic Privacy Information Center, and he says we can find a good model in the "Do Not Call list" -- it must apply to any business that touches your personal data online, including cell phone companies, mobile apps, and plain old websites.

"If you focus on the data that's being collected," he says, "and not the technology used to collect the data, you can actually write laws that do very well over time."

 

Follow Eve Troeh at @evetroeh