Romeo Chicco faced rejections from seven auto insurance companies in December before finally securing a policy, albeit at a significantly higher rate. The reason behind this, as per a federal class-action lawsuit filed recently, was the surveillance conducted by his 2021 Cadillac XT6.
Cars today are often referred to as “smartphones with wheels” due to their internet connectivity and array of sensors and cameras. The complaint alleges that Mr. Chicco was informed by a Liberty Mutual agent that his rejection was based on data from a “LexisNexis report,” typically used by insurers to track drivers’ violations, coverage history, and accidents.
Upon requesting his LexisNexis file, Mr. Chicco discovered detailed information on 258 trips taken in his Cadillac over the span of six months. This data included trip distances, timings, and any instances of speeding, hard braking, or acceleration—information provided by General Motors, the car’s manufacturer.
In the lawsuit against General Motors and LexisNexis, Mr. Chicco accuses them of breaching privacy and consumer protection regulations. The legal action follows revelations that automakers have been sharing driving behavior data with insurers without consumers’ knowledge, resulting in higher insurance premiums for some drivers. Data brokers like LexisNexis and Verisk claim to possess driving behavior information from millions of vehicles.
Mr. Chicco tried to ascertain why his data was collected without consent by contacting G.M. and LexisNexis multiple times. It was revealed that his data was transmitted via OnStar, G.M.’s connected services arm, despite his denial of enrolling in OnStar’s Smart Driver program, which offers driver feedback and rewards for good driving.
General Motors’ spokeswoman mentioned that customers typically enroll in SmartDriver through the connected car app or at dealerships, with data sharing clauses outlined in the OnStar privacy statement. While reviewing the lawsuit, G.M. had no immediate comments, referring back to their prior statements regarding OnStar Smart Driver.
LexisNexis declined to comment on the matter, stating in the past that they analyze driving data to create risk scores sold to insurers. Mr. Chicco expressed disbelief at the unauthorized data sharing and refrained from further comments after the lawsuit was filed.
Experts like David Vladeck emphasize the sensitivity of driving data, necessitating clear consumer notice and consent for its collection and dissemination. Anticipating further legal actions against automakers and data brokers, Vladeck predicts an impending wave of lawsuits over such privacy breaches.
