General Motors has reached a significant settlement related to privacy concerns with law enforcement agencies led by California Attorney General Rob Bonta. The issues stem from reports emerging in 2024 that highlighted the sharing of customer driving behavior data by various automakers, including GM, with insurance companies. Many consumers expressed worries regarding potential increases in their insurance rates as a consequence.
The settlement announcement detailed allegations that GM had sold the names, contact details, geolocation data, and driving behavior data of hundreds of thousands of Californians to Verisk Analytics and LexisNexis Risk Solutions, both of which are data brokerage firms. It was stated that this data was collected through GM’s OnStar program and that the company generated approximately $20 million from these sales.
However, the Attorney General’s office clarified that the data sharing did not lead to increased insurance rates in California. This outcome is attributed to the state’s insurance regulations, which prohibit insurers from utilizing driving data to determine insurance premiums.
As part of the settlement agreement, GM is required to pay $12.75 million in civil penalties and is mandated to cease the sale of driving data to any consumer reporting agencies for a duration of five years. Additionally, GM has committed to deleting any retained driver data within 180 days unless explicit consent is obtained from the customers. The company is also tasked with requesting LexisNexis and Verisk Analytics to delete the applicable data.
Bonta emphasized that GM sold the data of California drivers without their explicit knowledge or consent, despite previous assurances to customers that such practices would not occur. The settlement is viewed as a critical step in reinforcing data minimization in California’s privacy law, asserting that companies cannot retain data for purposes inconsistent with what was originally intended.
Previously, GM had faced repercussions from the Federal Trade Commission regarding its data sales, leading to a final order prohibiting the automaker and its OnStar service from selling certain information to consumer reporting agencies.
In a statement to Reuters, GM noted that the settlement pertains to its Smart Driver product, which was discontinued in 2024, and highlighted the measures the company has implemented to enhance its privacy practices.
