The automaker is selling driver data to insurance companies without permission from 2016 to 2024.
The states that sued General Motors over the entire OnStar Smart Driver program debacle have settled with the company. GM agreed to pay $220 million to settle the lawsuit filed by the attorneys general of 35 US states and the District of Columbia.
If you remember, The New York Times reported in 2024 that GM had enrolled millions of customers in its Smart Driver program from 2016 to 2024 and then tracked their driving habits. The automaker used Smart Driver to log data about hard braking, late-night driving and speeding and then sold the information to data brokers for insurance. As a result, insurance companies increased premiums for people based on information from the program.
GM did not tell its customers that their data would be sold for this purpose, the attorney general said. Apparently, many drivers weren’t even told they were part of the program. The automaker encouraged dealers with bonuses to sign up as many customers for Smart Driver as possible. Sometimes merchant employees would allegedly just accept its terms and conditions for customers without their express permission.
In addition, GM did not always inform customers about their registration. The AGs said more than 370,000 drivers were told they were not registered when in fact they were. The automaker eventually terminated them, but it did not inform them of the error and still sold their data. The data GM collected was “personal, identifiable and specific,” the AGs wrote.
GM is required to limit the driving data it collects from customers and protect their personal information going forward, as part of the settlement. The company will also be subject to mandated internal and external data protection and privacy program reviews, as well as monitoring and additional training at its dealers. Earlier this year, the Federal Trade Commission banned GM from sharing specific consumer data with third parties for five years because of the issue. In May, the automaker reached a separate settlement with California for $12.75 million.