On the Dash:
- GM Smart Driver settlement totals $220 million over alleged sales of driver data to insurers.
- GM must get affirmative express consent before collecting or sharing driving and location data.
- States allege GM rewarded dealership sign-ups, and in many cases employees accepted terms without consent.
General Motors (GM) will pay $220 million to settle allegations from a coalition of 36 attorneys general that it illegally sold driver behavior and location data from its Smart Driver program to third parties, including data brokers. The brokers then sold the data to insurers, which used it in part to set rates, according to a news release from the Washington State Office of the Attorney General.
According to the release, GM enrolled millions of drivers in Smart Driver from 2016 to 2024 and told them it would not share their data with insurers without express consent. The investigation found that GM sold the data to brokers under contracts specifying use for insurance products.
Insurers received trip start and end times, hard braking, fast acceleration and speeding data, and used it to change rates, sometimes raising premiums. GM discontinued the program after The New York Times reported on the practices.
The settlement requires GM to get affirmative express consent from consumers before collecting or disclosing driving and location data, the attorney general’s office said. GM must also limit the data it collects and run a comprehensive privacy program with internal and external assessments. The settlement also requires oversight and training at GM dealerships to prevent customers from being enrolled in data collection without consent.
Most customers signed up for Smart Driver at the dealership when they bought their car, according to the Attorney General’s Office. GM used a single sign-up process for Smart Driver and its OnStar services. In many cases, dealership employees allegedly accepted terms and conditions for customers without their consent. At the time, GM was heavily incentivizing dealerships to sign up customers for OnStar. Sales employees received bonuses based in part on enrollment numbers, and dealerships were ranked by them, the release said.
The OnStar app also told more than 370,000 drivers they were not enrolled in Smart Driver when they were, and GM kept collecting and selling their data, the office said. GM later unenrolled those drivers without telling them and left their data with brokers and insurers.
The settlement comes following other regulatory actions against the automaker over privacy concerns. In January, the Federal Trade Commission (FTC) finalized an order barring GM and OnStar from sharing driver data with consumer reporting agencies for five years.
