OnStar Class Action Lawsuit Claims General Motors Sold Driver Data, Boosting Insurance Premiums

A recently filed OnStar class action lawsuit alleges that General Motors (GM) used its OnStar Smart Driver service to secretly track driving habits, and then sold that data to insurance companies, resulting in higher premiums for vehicle owners.

OnStar is a subsidiary of General Motors, which provides a variety of in-vehicle services, including automatic crash response, roadside assistance, stolen vehicle tracking, navigation and other connectivity features. The service is integrated into new GM vehicles, and marketed as a safety feature that allows owners to access these services through a vehicle-mounted button, voice commands or a mobile app.

However, in a complaint (PDF) filed earlier this year in the U.S. District Court District of South Carolina, Richard Cashon claims that General Motors LLC, OnStar LLC, LexisNexis Risk Solution Inc. and Verisk Analytics Inc. secretly used the technology to collect detailed driving data on him and millions of other GM vehicle owners.

The GM OnStar lawsuit seeks class action status, to pursue damages on behalf of all individuals throughout the United States who owned or leased a GM manufactured vehicle, and had their driving data collected and shared with a third party without their consent.

Cashon alleges that the data collected by OnStar included metrics like acceleration, hard braking events, and sometimes even the vehicle’s location and GPS data. He claims that GM sold this information to LexisNexis and Verisk, who then shared it with his insurance company. As a result, Cashon claims the detailed data was used to adjust his premiums, leading to an increase of hundreds of dollars.

While the complaint does not name specific insurance companies that purchased the data, Cashon’s complaint identifies Verisk, a major data analytics firm, as one of the entities that received or purchased the information. According to Verisk’s website, several of the largest auto insurance carriers in the U.S. are linked to its Data Exchange, suggesting that millions of customers may have been negatively impacted by the data sharing practices.

According to the complaint, Cashon purchased a 2018 General Motors Sierra Crew Cab truck in January 2022. Like many GM models, the vehicle came equipped with OnStar technology, which had the ability to collect detailed driving data. However, Cashon indicates that he never activated his vehicle’s OnStar system, nor did he consent to its collection or sharing of his driving information.

Cashon claims he experienced several increases in his vehicle’s insurance premiums after purchasing the vehicle, without any corresponding claims or adverse incidents on his part, which would typically justify such hikes. These increases occurred semi-annually and totaled over $273 within a year and a half.

The GM OnStar class action lawsuit claims that Cashon’s driving data, including instances of hard braking and rapid acceleration, was secretly collected through his vehicle’s OnStar system without his knowledge or consent. This data was then used by his insurance company to evaluate his risk as a driver, resulting in an upward adjustment of his premiums.

“It is clear that neither GM nor OnStar provide consumers with any disclosure that their driver behavior data is being or will be collected, gathered, stored, transmitted, or sold to third parties, much less without compensating the consumer for their data,” Cashon said in his complaint. “More disconcerting still is that GM and OnStar do not disclose their sale of driver behavior data to third parties like LexisNexis and Verisk who then resell – for profit – the data to automobile insurers resulting in higher insurance quotes or premiums.”

The complaint raises allegations including violation of the fair credit reporting act, violation of the federal wiretap act, unjust enrichment and invasion of privacy.

Cashon’s lawsuit further requests the court to order the defendants to delete all driver data, and to implement procedures that require consent before recording and selling customer data.

General Motors OnStar Services Discontinued

In late 2023, GM announced its decision to discontinue the OnStar Smart Driver service, alluding to a shift in the company’s focus toward newer technologies and addressing growing concerns around data privacy.

However, in March 2024, the New York Times released a report indicating that the company may have been sharing OnStar driving data with third parties and the insurance industry, prompting a wave of concerns among customers that their driving data was being collected and shared without their consent.

In response to the mounting criticism, GM issued a press statement in April 2024, announcing the full discontinuation of its OnStar technology and the termination of its partnerships with data firms LexisNexis and Verisk. Additionally, GM appointed Alisa Bergman as its new Chief Trust and Privacy Officer to oversee the company’s privacy policies and rebuild consumer trust.

As General Motors implements internal changes to rebuild customer trust, numerous individuals are now filing lawsuits over OnStar’s data collection practices, targeting both the automaker and its affiliated parties.