GM sued for selling data on 16 million drivers to insurance companies

General Motors has been sued The state of Texas has filed criminal charges against a driver, accusing him of selling detailed driving records to insurance companies for profit, The New York Times reported on Tuesday, August 13.

The lawsuit alleges that GM used its OnStar telematics system to collect data on 16 million drivers and sold it to auto insurers, causing those customers’ insurance premiums to skyrocket or their coverage to be reduced.

The data includes individual users’ driving behavior, start and end times of specific trips, and instances of speeding above 80 mph and emergency braking. Late-night driving, seatbelt use, and “sharp turns” are collected and sold to external vendors, who then compile a “driving score.”“ Sold to insurance companies.

According to the New York Times, GM received “millions of dollars” through multiple revenue streams, including upfront payments from insurance companies and ongoing royalties. In March, the newspaper reported that several car companies were selling driving data, which was then used by LexisNexis to create these driver profiles. Both the report and the Texas lawsuit indicated that this was all done without the driver’s knowledge and that the practice had been common since 2015.

The lawsuit alleges that GM used misleading and deceptive tactics to get customers to sign up for OnStar products, such as GM’s mobile app and connected car services. The process was part of more than 50 pages of documentation at dealerships to receive a car, which included “a confusing array of applicable user terms and privacy statements.”

The information makes it sound as if GM will use the data to improve the safety and functionality of its cars. OnStar bills itself as a theft deterrent, a provider of roadside emergency assistance, an automatic crash response feature, and a system that alerts emergency services in the event of a crash.

“GM never informed its customers that it was selling any data, let alone driving data,” the lawsuit states.

GM said it is reviewing the complaint. Texas is seeking a jury trial and civil penalties against GM, as well as requiring the destruction of all collected data.

High-resolution gallery: OnStar Proactive Alerts

This article was originally published by ClassicCars.com’s editorial partner Motor Authority