It might violate your privacy, raise your insurance rates, or worse.
If you have an internet-connected car, you could be sending data to the insurance company that tracks things like how fast you drive, how often you drive at night, how hard you brake, and other metrics. All of these data points add up and create a profile of your driving habits—and this might not be a good thing.
If you’ve had a driver’s license for several years, you might know the sinking feeling you get if you see rotating lights in your rearview mirror. Did you do something wrong without realizing it? Are you being pulled over for a traffic violation? Once upon a time, if you did something wrong, you’d need to be “caught” for there to be a consequence.
While red light cameras and other traffic surveillance has caused their share of controversy, there’s a new way that your driving behavior is being tracked—and some people say it infringes on their privacy.
But more so than your privacy, this new technology could affect your automotive insurance coverage.
A New York Times article published in March 2024 shed light on vehicle manufacturers that install software that reports driving behavior to insurance companies.
How your vehicle might be tracking your driving
Some insurance companies incentivize drivers who install a dongle in their car that monitors their driving. The dongle or smartphone app monitors how much they drive, how hard they brake, whether they speed, and other factors. Typically, people don’t choose to participate in these programs voluntarily. But now, we’re learning that some car companies sell internet-connected vehicles with this monitoring already taking place—and the consumer likely doesn’t even know.
These internet-enabled vehicles provide services that the consumer wants, like GPS, roadside assistance, or other user-friendly apps. Some consumers eagerly sign on for these types of features. But some have realized they signed on for more than they bargained for.
Some vehicles, including those made by G.M., Honda, Kia and Hyundai, offer optional features that rate the owner’s driving. If the owner opts for these features, the companies provide that information to insurance companies. Manufacturers claim that the drivers’ give their consent for this information sharing because they opt in to the features, but drivers don’t always realize that the data sharing is part of the deal.
Some drivers of G.M. vehicles claimed that they were tracked even though they didn’t turn on the feature.
What happens to your driving data when it’s shared?
Some drivers have complained that their insurance rates have increased after the companies’ received their driving behavior reports. Others have said they don’t really know what the problematic behaviors are. One person said he thinks it’s too subjective for the software to decide what’s a “hard brake” or acceleration. He says he’s not driving aggressively or dangerously, but what his insurer hears is different from his own opinion.
This driver was enrolled in OnStar Smart Driver. This product is a service provided in G.M. internet-connected vehicles to “help you become a better driver.” It tracks and rates your seatbelt use and driving habits. Using the apps gives people digital badges like “brake genius” or “limit hero.” For some consumers, this seems fun and harmless (and perhaps beneficial) because they compete with friends or spouses to see who is a better driver.
But some people were using this service without even realizing it. G.M. sales representatives would receive bonuses for enrolling customers in the OnStar program, and it’s possible that some people were signed up at a dealership without knowing they’d done so.
After all, if you’ve leased or purchased a car, you know there’s a LOT of fine print—and many of us simply sign on the proverbial dotted line without reading every word or clause in a contract. Should we carefully read everything we sign? Yes. But is it realistic that most people will? No.
One researcher suggested that it would “impossible” for consumers to truly understand the legal language in car companies’ policies concerning data collection. She says that the car manufacturers link their consumer-friendly apps and safety services to data mining companies and the average driver has no idea.
The auto manufacturers claim the driver feedback programs are intended to help people develop safer driving habits.
What do insurers do with the information?
Data about a person’s driving habits is transmitted to a third-party data collector, which then sells the information to insurance companies.
When the consumer shops for an auto insurance policy, they must sign a form allowing the insurance company to pull a third-party report. This is similar to a tenant renting an apartment and giving consent for the leasing agent to run a credit check. The insurance company also likely requests access to credit reports (but this is prohibited in some states).
Sometimes, it’s not even the driving quality that raises your insurance rates. One of the metrics is how much the person drives at night because night driving has a statistically higher likelihood of an accident than during the day. You can be a “perfect” driver and never speed, brake too hard, turn too fast, or perform in any way that an insurer would deem problematic and still be flagged because of how often, how far, or the times of day when you drive.
One expert said that he thinks the benefit of usage-based insurance is that people drive better if they know they are being monitored; this clearly doesn’t help people who don’t know they are being tracked.
Legal ramifications of driver-behavior monitoring
Can your driver behavior data come back to haunt (or help) you?
At this time, there are no known instances when a claimant in a car accident lawsuit has been able to use this type of driver behavior data to prove liability for a crash—but that doesn’t mean it couldn’t happen in the future.
For instance, if a person’s data profile has regular instances of speeding, braking harshly, failing to stop at stop signs or other traffic controls, etc., then can that be used to infer that it’s more likely that they were speeding and caused the crash that’s the subject of a lawsuit? We don’t know. But it’s not impossible that this data could one day be used in court.
This could drastically change how a plaintiff could win a car accident lawsuit, and lawyers will need to figure out new strategies for using or disproving this data.
Along those same lines, might an insurer refuse you a policy or refuse to cover an accident if you have a history of risky driving? We don’t know yet. It’s worth keeping an eye on this in the years ahead to see how it develops.
Can you protect yourself from driver-behavior monitoring?
At this time, it appears that the main detriment (aside from privacy concerns) to driver-behavior monitoring is that it could increase your insurance premium rates.
However, it’s always a good idea to understand how your data is being tracked, where it’s going, and who has access to it—regardless of what type of data it is. If your vehicle isn’t internet-connected, then this isn’t a concern for you right now. A car that can’t communicate can’t “tell” anyone anything, unless you use any type of app on your phone that might be tracking your behavior.
If your vehicle is internet-connected, you can do a few things:
- Read any contracts you signed carefully to see if you can determine how your data might be used (but be prepared that these include dense language that you might not know how to interpret);
- Contact the dealership where you purchased your car to find out how your data is collected and transmitted;
- Use https://vehicleprivacyreport.com/ to determine the status of data for your vehicle;
- Google “privacy request form” with the make and model of your vehicle to see how to request information that the company has about you;
- If your vehicle’s manufacturer works with LexisNexis or Veririsk, you can request your data from those companies here: https://consumer.risk.lexisnexis.com/consumer or https://fcra.verisk.com/#/ .
Alternatively, if none of these measures provide the information you need, you can contact an attorney who will review the terms of your contracts or work with your insurer, car company, or a third party to determine what information is being used and how.