- GM is settling a lawsuit brought by 35 states plus the District of Columbia.
- The automaker will be required to limit data collection and gain explicit consent going forward.
- This isn’t GM’s first settlement payment related to owners’ privacy.
General Motors last week agreed to pay $220 million to settle a lawsuit with the attorneys general of 35 states plus the District of Columbia. The automaker was accused of illegally selling its owners’ data, which eventually ended up in the hands of insurance companies.
According to the suit, GM sold the data to brokers, who then sold it to insurance companies. The information was used to set insurance rates, and in some cases, drivers saw increases. The lawsuit gained bipartisan support from a long list of state attorneys general. Oregon’s AG, Dan Rayfield, said in a statement that, “People bought a car, not a tracking device.”
GM launched the Smart Driver program several years ago, promoting it as a way to help drivers improve their habits on the road, such as avoiding hard braking and speeding. The program accumulated millions of users between 2016 and 2024, when GM cut the cord.
Beyond the settlement payment, GM will be required to limit the amount of data it collects, and it will be required to get drivers’ consent before collecting or sharing the information. In a statement to USA Today, the company said, “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.”
This is just the latest penalty the automaker has faced, as earlier this year it paid $12.75 million to settle a California investigation of its collection and sharing practices.
While GM is under the microscope for data sharing, several insurance companies offer telematics-based programs that track drivers’ usage and behavior to set rates. These programs can offer discounts for safe drivers, but it’s important to read the fine print to ensure you’re comfortable with the privacy trade-offs required to get those discounts.
