Massachusetts will receive $5.7 million under the agreement, which requires GM to obtain drivers’ express consent before collecting or disclosing driving and location data.
General Motors has agreed to pay $220 million pursuant to a settlement agreement with 36 attorneys general, including Massachusetts, to resolve allegations that it had unlawfully sold consumers’ driving and location data to third parties which was in turn resold to auto insurers. In announcing the agreement, Massachusetts Attorney General Andrea Joy Campbell’s office noted that for many consumers nationwide, the data obtained was “…potentially used by insurance companies in part to set insurance rates, without consumers’ consent or knowledge.”
“Massachusetts drivers deserve to know their personal information and driving history will be protected and not sold to entities that could exploit it,” said AG Campbell. “This settlement requires GM to make significant improvements to its data use, disclosure, and transparency practices to protect consumers’ personal identifying information moving forward.”
How Smart Driver Data Reached Insurers
From 2016 to 2024, GM enrolled millions of drivers in Smart Driver, a program it marketed as a tool to help motorists improve their driving habits. GM offered the tool as a way to improve their own driving safety. It also told drivers it would obtain their express consent before sharing their data with insurers. The attorneys general said GM sold the data to brokers under contracts specifying its use in insurance products. The brokers then sold the information to insurers. According to Campbell’s office, GM did not tell drivers their data would be sold for that purpose.
The records uncovered by the investigation showed otherwise. In reality, the coalition found that GM has sold this information to data brokers under contracts explicitly stating that the data would be used for insurance products.
According to the AG’s office, the data sold was personal, identifiable, and specific. It showed how many times a driver drove their vehicle, the start and end times of each trip, how many times they braked quickly or accelerated sharply, and whether they exceeded the speed limit. Armed with this data, the AG’s office contended, insurance companies could employ this data as one factor in setting premiums.
Dealership Enrollment and Incorrect App Notices
Most Smart Driver customers enrolled at the point of sale at a GM dealership. GM offered a “one-sign-up process” enabling a customer to enroll in both Smart Driver along GM’s other OnStar services. In many cases, the attorneys general alleged that dealership employees simply accepted the terms and conditions on behalf of customers without their understanding or consent. Moreover, these actions by employees were often incentivized by bonuses paid to sales employees based upon how many customers they had signed up for GM’s connected vehicles services. Dealerships were ultimately ranked by GM based upon these enrollment numbers.
In addition to the above claims, Campbell’s office said the OnStar app incorrectly told 370,000 drivers they were outside the Smart Driver program while GM was collecting and selling their data. GM later “quietly unenrolled” these drivers from the program without telling them about the error. The data already sold remained with the data brokers and insurers, however. According to the AG’s office, GM discontinued Smart Driver after The New York Times reported on the practices.
Settlement Requires Express Consent
In addition to the $220 million payment, the settlement agreement also requires GM to obtain affirmative express consent before collecting or disclosing any consumers’ driving and location data going forward. GM must also limit the driving data it collects and conduct internal and external audits and assessments of its data protection and privacy program. It must also implement dealership oversight and training to prevent future enrollments in programs without a driver’s consent.
As a result of this settlement agreement, Massachusetts will receive $5.7 million of the total settlement amount.
