Kentucky Attorney General Russell Coleman has announced a $220 million nationwide settlement with General Motors (GM) over allegations of illegally selling consumers’ private driver behavior data and location information to third parties.
According to Coleman’s office, insurance companies used the data in part to hike insurance rates.
Kentucky, which joined a 36-state coalition, is set to receive nearly $6.5 million. As part of the settlement, GM is now required to obtain consent from consumers before collecting or disclosing consumer driving and location data.
Between 2016 and 2024, GM enrolled millions of drivers in its Smart Driver program at the same time they signed up for GM’s OnStar services. Sales employees received bonuses based in part on how many customers they signed up for these connected vehicle services and dealerships were ranked based on their enrollment numbers.
The automaker pitched this tool as a way for drivers to improve their own driving safety but ultimately sold their information. Insurance companies who purchased the information were then able to change the driver’s premium based on driving habits including how many times they braked or accelerated quicky and whether they went faster than the speed limit. GM later discontinued the Smart Driver program.
“We are committed to protecting Kentuckians, their data privacy and their wallets. Kentucky drivers can rest assured their Attorney General’s Office stands at the ready to fight for their families,” Coleman said.
As part of the settlement, GM will now limit the data it collects from consumers and protect their personal information going forward. They’ve also agreed to oversight and training requirements at their dealerships to protect consumers against being enrolled in data collection schemes without their consent.
GM offered the following statement: “This agreement addresses Smart Driver, a product we ended in 2024, and reinforces steps we’ve taken to strengthen our privacy practices. Safer, more helpful and personalized experiences are enabled by connected vehicle data, and GM is committed to being clear about what information is used, how it’s protected, and the choices customers have about what they share.”
Coleman served on the litigation’s executive committee. The coalition was co-led by Washington and Oregon and besides Kentucky, included the state attorneys general of Alabama, Alaska, Arizona, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Hawai’i, Idaho, Illinois, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Utah, Vermont, Virginia and Wisconsin.
You can read the 38-page settlement agreement here.
Photo courtesy of GoogleMaps
