GM sued by Arkansas for selling data to insurers

GM and its subsidiary OnStar have been sued by the Arkansas attorney general for allegedly selling drivers' data illegally, marking the latest accusation against the automaker for profiting off data without consent.

OnStar, GM's in-car safety and security system, collected the data that was sold to third parties and eventually went to car insurers who may have used it to increase rates, the Arkansas attorney general said Feb. 26.

"These third parties then sold the data to insurance companies, who used that data to deny consumers coverage or increase their rates," Arkansas Attorney General Tim Griffin said in statement. "Despite advertising OnStar as offering the benefits of better driving, safety, and operability of its vehicles, GM and OnStar used the data to pad their profits at the expense of consumers."

The lawsuit alleges GM began selling the driver data in 2015, collected through systems such as myChevrolet, myCadillac, myGMC and myBuick, unlike insurance offerings that require the installation of an optional device to collect driver data, Claims Journal reports.

“We are reviewing the complaint," a GM spokesperson said to ConsumerAffairs. "GM is committed to protecting consumers’ privacy.”

The lawsuit seeks monetary relief for consumers, injunctive relief and attorneys’ fees and expenses, the attorney general said.

A string of accusations

The lawsuit is part of a string of accusations against GM for selling data improperly.

In January, GM settled with the Federal Trade Commission over similar allegations that it sold data to third parties, and agreed to not sell geolocation or driving information for five years.

“GM will obtain affirmative customer consent to collect, use, or disclose certain types of connected vehicle data,” GM said after the FTC settlement. “We’re more committed than ever to making our policies and controls clear and accessible.”

The Texas attorney general also filed a similar lawsuit against GM in August, alleging GM illegally sold driving data of more than 1.5 million Texans.

Car insurers are facing scrutiny for how they gather and use driver data, too.

In January, the Texas attorney general sued insurer AllState and its subsidiary Arity, alleging the insurer secretly collecting driver data from smartphones.

Allstate said its actions were legal.

“Arity helps consumers get the most accurate auto insurance price after they consent in a simple and transparent way that fully complies with all laws and regulations,” Allstate said in a statement.