"Upon consent and enrollment in OnStar Smart Driver, depending on vehicle capability, the vehicle will collect specific driving behavior data, including hard braking events, hard acceleration events, speeds over 80 miles per hour, average speed, late-night driving, when a trip occurs and the number of miles driven."
In recent years, insurance companies have offered incentives to people who install dongles in their cars or download smartphone apps that monitor their driving, including how much they drive, how fast they take corners, how hard they hit the brakes and whether they speed.
Car companies are collecting information directly from internet-connected vehicles for use by the insurance industry.
Modern cars are internet-enabled, allowing access to services like navigation, roadside assistance and car apps that drivers can connect to their vehicles to locate them or unlock them remotely. In recent years, automakers, including G.M., Honda, Kia and Hyundai, have started offering optional features in their connected-car apps that rate people’s driving.
After LexisNexis and Verisk get data from consumers’ cars, they sell information about how people are driving to insurance companies. To access it, the insurance companies must get consent from the drivers — say, when they go out shopping for car insurance and sign off on boilerplate language that gives insurance companies the right to pull third-party reports. (Insurance companies commonly ask for access to a consumer’s credit or risk reports, though they are barred from doing so in California, Massachusetts, Michigan and Hawaii.)
An employee familiar with G.M.’s Smart Driver said the company’s annual revenue from the program is in the low millions of dollars.
Last month, Senator Edward Markey of Massachusetts urged the Federal Trade Commission to investigate.
“The ‘internet of things’ is really intruding into the lives of all Americans,” Senator Markey said in an interview. “If there is now a collusion between automakers and insurance companies using data collected from an unknowing car owner that then raises their insurance rates, that’s, from my perspective, a potential per se violation of Section 5 of the Federal Trade Commission Act.”
Omri Ben-Shahar, a law professor at the University of Chicago, said by “stealth enrollment” in programs with “surprising and potentially injurious” data collection there is no public safety benefit if people don’t know that how they drive will affect how much they pay for insurance.
