GM's low-cost insurance push backfired, leaving drivers with higher bills and a $220 million settlement

In some cases, insurers raised rates using the data.

General Motors has agreed to pay $220 million to settle allegations that a program promoted as a way for drivers to save on insurance instead provided information that was used to set premiums, leaving some owners paying more.

What to know

GM's Smart Driver program gave participants monthly driving scores and was presented as a path to safe-driver discounts through participating insurers, according to Autoblog.

Some motorists later grew concerned after their premiums climbed without an obvious explanation. Further review showed that GM had been selling Smart Driver data to brokers, who then passed it along to insurance companies. In some instances, those insurers used the information to increase rates.

After the sales of that data were exposed, GM faced privacy lawsuits. The settlement resolved a case filed by attorneys general from 35 states and the District of Columbia.

Other automakers have faced similar claims

GM was not the only automaker accused of tracking drivers and then sharing that information without permission.

Autoblog reported that a similar arrangement led to a class-action lawsuit against Toyota. In that case, the RAV4 owner who filed the suit said he discovered the alleged monitoring after noticing his insurance costs were rising.

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Sharing data with outside companies is different from collecting it inside a vehicle. Connected cars' telematics and communications systems gather information as part of how they work, and so do devices tied to third-party insurance discount programs.

Still, there is no broad legal framework that fully protects drivers when it comes to how personal data is used and who it is shared with.

What has changed?

Autoblog reported that GM ended the Smart Driver program and stopped selling information to LexisNexis and Verisk during 2024.

Along with the $220 million payment, the settlement also requires GM to adopt safeguards meant to protect customer information and limit data collection.

GM also agreed not to pressure customers into joining data collection programs and to revise dealership training practices.

"Washingtonians' data is personal and valuable, which is why they should always have control over how it's used," Nick Brown, the Washington AG, said in a press release. "We're proud to lead this bipartisan agreement holding GM accountable for misusing drivers' data."

More to read

Data sharing is only one of several insurance practices drivers have challenged recently. These stories look at other concerns, from questionable tactics to sharply rising premiums.

• A New York lawsuit alleged that Allstate refused full rental reimbursement after setting Enterprise's rate.

• A claims-free Farmers customer faced a six-month premium increase of $545, with no loyalty break.

• An EV owner saw insurance rise to $1,690 from $1,180, prompting debate about battery age.

• A newly licensed 21-year-old faced a $7,200 family insurance increase, prompting advice to shop around.

• Colorado's full-coverage rates jumped 36% as one Denver driver reported paying $200 monthly.