Scathing Report Finds Some Cars Are Reporting Drivers' Habits to Insurance Companies and Raising Their Rates
A new report in The New York Times is illuminating some of the troubling concerns that drivers have when it comes to their cars. But it doesn't have to do with their engines.
According to the report, some drivers may not realize that their driving data is being stored and shared with insurance companies. Seattle driver Kenn Dahl, for example, drives a Chevrolet Bolt, and was shocked when in 2022 his car insurance costs jumped by 21 percent and he received similar high quotes from other insurance companies.
It turns out his LexisNexis report played a part in his high costs. LexisNexis is a global data broker with a special division designed for the auto insurance industry that tracks car accidents and tickets. Dahl requested a report from the company and found detailed information on every time he or his wife drove the car in recent months, including his driving speed or whether he braked or accelerated dramatically. The document explained that the details were provided by Chevy Bolt manufacturer General Motors.
LexisNexis spokesman Dean Carney said this data is analyzed to create a risk score “for insurers to use as one factor of many to create more personalized insurance coverage," according to The New York Times. In a statement, the company claimed it has "strict privacy and security policies designed to ensure that data is not accessed or used impermissibly."
Dahl, for his part, was furious. "It felt like a betrayal," he said. "They’re taking information that I didn’t realize was going to be shared and screwing with our insurance."
While insurance companies in recent years have offered incentives for drivers who allow their driving habits to be tracked, many have been slow to adopt the practice and wary of having their daily lives followed. Car companies are now reportedly getting that information themselves from internet-connected vehicles. And it's not just limited to GM; Kia, Subaru, and Mitsubishi all share information with LexisNexis, while Ford, Honda, and Hyundai work with Verisk, another risk assessment company.
The Times report even claimed that some drivers were tracked even when they didn't turn on the OnStar Smart Driver feature available in their cars. GM spokeswoman Malorie Lucichk, however, denied this claim.
"GM’s OnStar Smart Driver service is optional to customers," she said. "Customer benefits include learning more about their safe driving behaviors or vehicle performance that, with their consent, may be used to obtain insurance quotes. Customers can also unenroll from Smart Driver at any time."
If you notice your rates go up, you might want to double-check you aren't unintentionally opted in to one of these programs.
