GM’s Hidden Data Sales Could Have Raised Your Insurance Rates

General Motors (GM) is currently dealing with a number of legal issues related to accusations that it has been selling driver data collected from its connected vehicles to third-party companies. These third-party companies then reportedly shared the data with insurance providers. These legal disputes are bringing attention to growing worries about data privacy in the car industry and the possibility that personal information collected without clear permission could be misused.

In February, Arkansas Attorney General Tim Griffin filed the most recent lawsuit against GM and its subsidiary, OnStar. The lawsuit claims that GM has been illegally selling driver data since 2015. This data, gathered through connected vehicle systems like myChevrolet, myCadillac, myGMC, and myBuick, supposedly includes information about driving habits, location, and possibly other sensitive details. Unlike traditional telematics programs that require users to opt in, GM is accused of collecting this data without getting clear consent from consumers.

The lawsuit argues that GM misled consumers by making them believe that OnStar’s main purpose was to improve safety and vehicle performance, rather than to make money by selling data. The Arkansas lawsuit is asking for financial compensation for affected consumers and legal measures to stop GM from selling data in the future.

This lawsuit is not an isolated incident. In January 2025, GM reached a settlement with the Federal Trade Commission (FTC) over similar accusations. As part of the settlement, GM agreed to stop selling geolocation and driving behavior data for five years and promised to get explicit consent from consumers before collecting such data in the future. While this settlement acknowledges that GM violated rules in the past, it doesn’t fully address the issue of data that was already sold.

GM’s legal troubles don’t end there. In August 2024, Texas Attorney General Ken Paxton filed a separate lawsuit against GM, accusing the company of illegally selling driving data from more than 1.5 million Texans. This case is still ongoing, and it further highlights the widespread nature of GM’s alleged data practices. In addition to these state-level lawsuits, GM is also facing 27 consolidated class-action lawsuits. These lawsuits claim that GM’s data practices led to higher insurance rates for drivers. Together, these legal challenges pose a significant risk for GM.

GM isn’t the only company facing these kinds of legal issues. The car industry and the insurance sector are increasingly under scrutiny for how they collect and use driver data. Earlier this year, Texas also sued Allstate and its subsidiary Arity for allegedly collecting driver data from smartphones without users’ knowledge. These lawsuits point to a larger problem in the industry: a lack of transparency and clear consent when it comes to collecting and selling driver data.

The data involved in these lawsuits is extremely sensitive. Connected vehicles collect more than just mileage; they can gather information about driving speeds, acceleration patterns, braking habits, and precise GPS locations. This data is valuable to insurance companies because it allows them to assess risk more accurately, which could lead to higher premiums for some drivers or even the denial of coverage.

The lawsuits also claim that GM and other companies misled consumers by hiding the true purpose of data collection, which adds to the ethical and legal complexity of the cases. The outcome of these lawsuits could have major consequences for GM and the car industry as a whole. If GM is found liable, it could face significant financial penalties and potentially set a precedent for stricter rules about how driver data is collected, used, and sold.

These cases are likely to influence industry standards, pushing car manufacturers and insurance companies to be more transparent and to prioritize consumer rights when handling data. The future of connected vehicle technology depends on addressing these privacy concerns effectively, ensuring that the benefits of advanced car systems don’t come at the expense of individual privacy and data security.