Auto Insurance Rates Increase after Carmakers Share Driver Data: General Motors, Ford, Honda, and Others
Seattle-area Drivers Alarmed by Unexpected Insurance Hike
Drivers of cars manufactured by General Motors, Ford, Honda, and other popular brands say that their insurance rates went up after the companies sent data about their driving behavior to issuers without their knowledge.
Seattle-area Businessman’s Insurance Costs Soar
Kenn Dahl, 65, a Seattle-area businessman, experienced a significant increase in his car insurance costs after data collection by GM’s OnStar Smart Driver system. Dahl’s insurance agent informed him that the hike was based on data compiled by LexisNexis, which tracked his driving habits over a six-month period.
Extent of Data Detailing Driving Habits Leaves Drivers Concerned
The detailed 258-page report provided by LexisNexis for Dahl revealed start and end times of trips, distance driven, and specific instances of speeding, hard braking, and sharp accelerations, triggering concerns over privacy invasion. Dahl expressed feelings of betrayal, unaware that his data would be shared.
Wide Implications with Multiple Car Manufacturers Gaining Driver Behavior Data
General Motors is not the only car company gathering data through internet connectivity and providing it to insurance companies. Subaru, Mitsubishi, Honda, Kia, and Hyundai have similar features that collect driver behavior data.
Contemplating Legal Actions and Car Changes
One disgruntled Cadillac driver based in Palm Beach County, Fla., was denied car insurance policies by seven different companies after a LexisNexis report detailed six months of his driving behavior, resulting in a potential lawsuit against GM. The driver has vowed not to purchase another GM-made vehicle.
Transparency and Consent Key in Consumer Data Sharing
While car companies like Ford claim to not transmit connected vehicle data to brokers, explicit driver consent remains essential in data sharing. Several car manufacturers, including Kia, Mitsubishi, Hyundai, Honda, and Acura, allow drivers to turn off data collection regarding on-road behavior in their apps.
Industry Responses and Justifications
GM clarifies that their OnStar Smart Driver service is optional and requires consent from customers. LexisNexis states that it utilizes the OnStar data to assist insurers in creating personalized insurance coverage.
