General Motors will pay $220 million to settle allegations that it illegally sold consumers’ private driver behavior data and location information to third parties, including data brokers who then sold the data to insurance companies, Colorado Attorney General Phil Weiser announced. According to Weiser, the data was used by insurance companies, in part, to set insurance rates.
Weiser joined a coalition of 36 attorneys general in the case against GM. The settlement requires GM to obtain affirmative express consent from consumers before collecting or disclosing consumer driving and location data.
“When consumers signed up for GM’s Smart Driver program, they thought they were getting information to improve their driving safety,” Weiser said. “Our investigation found that GM sold consumers’ data to data brokers, who then sold it to insurance companies so that they could jack up premiums based on the consumer’s driving habits. GM’s data collection and privacy practices violate our state’s data privacy and consumer protection laws. Today’s settlement holds GM accountable and clearly lays out the state’s expectations for compliance with our privacy laws as car companies roll out new technology.”
The attorney general's release states that, from 2016 to 2024, GM enrolled millions of drivers in their Smart Driver program, which tracked their driving habits. GM pitched this tool as a way for drivers to improve their own driving safety and told drivers that they would not share their data with insurers without express consent.
However, the coalition found that GM sold this information to data brokers under contracts that specified the data was to be used for insurance products. The data brokers sold the data to insurance companies, who could then change the driver’s premium based on their driving habits. GM did not disclose to drivers that their data would be sold for this purpose.
“This agreement addresses a product we ended in 2024 and reinforces steps we’ve taken to strengthen our privacy practices,” GM said in an emailed statement to TechCrunch. “Safer, more helpful and personalized experiences are enabled by connected vehicle data and GM is committed to being clear about what information is used, how it’s protected and the choices customers have about what they share.”
Most customers who signed up for Smart Driver did so at the GM dealership when they bought their vehicle. GM used one sign-up process for drivers to enroll in Smart Driver along with GM’s OnStar services. In many cases, dealership employees allegedly accepted terms and conditions on behalf of customers without their consent. At the time, GM was heavily incentivizing dealerships to sign up as many customers for OnStar as possible. Sales employees received bonuses based in part on how many customers they signed up for GM’s connected vehicle services and dealerships were ranked based on their enrollment numbers, Weiser's release said.
GM’s own systems failed to notify drivers about whether their data was being tracked. The OnStar app mistakenly told over 370,000 drivers that they were not enrolled in Smart Driver, when they actually were enrolled and GM was collecting and selling their data. GM later quietly unenrolled these over 370,000 drivers without telling them about the mistake and left their data with the data brokers and insurance companies.
The data GM sold was personal, identifiable and specific. Insurers had data showing how many times a person drove their vehicle, the start and end times of each drive, how many times they braked or accelerated quickly and whether they went faster than the speed limit. As documented in The New York Times, insurance companies then used this information to change rates, sometimes increasing their premiums. After the Times reported on these practices, GM discontinued the Smart Driver program.
The settlement also requires GM to limit the driving data it collects from consumers and protect their personal information going forward as part of a comprehensive data privacy program. The terms secured by the coalition are significantly stronger than any other resolution reached with GM for this conduct including by mandating internal and external data protection and privacy program assessments. GM also agreed to oversight and training requirements at their dealerships to protect consumers against being enrolled in data collection schemes without their consent.
The case was co-led by Washington and Oregon, assisted by the executive committee of Colorado, Connecticut, Delaware, Illinois, Kentucky, Maryland, Minnesota, New Jersey, Utah and Vermont, and joined by the attorneys general of Alabama, Alaska, Arizona, the District Of Columbia, Florida, Hawai’i, Idaho, Kansas, Maine, Massachusetts, Michigan, Mississippi, Nevada, New Hampshire, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Virginia and Wisconsin.
