New Jersey will receive $8.9 million under a multistate settlement resolving allegations that General Motors (GM) sold drivers' driving habits and location data without authorization. The nationwide settlement, secured by a coalition of 36 state attorneys general, totals $220 million. Going forward, GM must obtain consumers' explicit consent before collecting or disclosing driving and location data.
In a press release on Thursday, the 29th, the New Jersey Office of the Attorney General said New Jersey will receive $8.9 million under a multistate settlement resolving allegations that General Motors (GM) illegally sold consumers' driving habits and location data. According to the office, GM passed the data to third parties, including data brokers, which then sold it to insurance companies. After litigation by a coalition of 36 state attorneys general, including Attorney General Jennifer Davenport, the nationwide settlement was set at $220 million.
According to the Attorney General's office, from 2016 to 2024 GM enrolled millions of drivers in its "Smart Driver" program, which tracked their driving habits. GM promoted the program as a tool for drivers to improve their own safe driving, and told them it would not share the information with insurers without explicit consent. However, the coalition's investigation found that GM sold the data to brokers under contracts that explicitly stated it would be used for insurance products. Insurers could adjust premiums based on individual behavior such as seat belt use, speeding, hard braking and sharp turns, as well as the number of trips and the start and end times of each trip.
How drivers were enrolled was also flagged as a problem. Most customers were signed up at dealerships when they bought a car, and GM bundled Smart Driver and OnStar services into a single enrollment process. The Attorney General's office alleged that dealership employees often accepted the terms on customers' behalf without their consent. It also said that GM at the time gave bonuses to sales staff who increased OnStar enrollment, and that dealerships were ranked by enrollment numbers. The allegations also include that the OnStar app wrongly told 370,000 people they were not enrolled, and that GM canceled their enrollment without notifying them while leaving their data with brokers and insurers. GM discontinued the program after reporting by The New York Times.
Under the settlement, GM must obtain consumers' explicit consent before collecting or disclosing driving and location data. It must also limit the scope of the driving data it collects, operate a privacy program, and undergo internal and external assessments. Dealerships will be subject to oversight and training requirements to ensure consumers are not enrolled in data collection without their consent. The Attorney General's office said the terms are far stronger than those of any other settlement reached with GM.
The New York attorney general is also among the states that joined the settlement. However, the Attorney General's office announcement does not say how the $8.9 million will be used or whether compensation will be paid to individual drivers who were harmed. As a result, it is currently unclear whether GM vehicle owners will receive any money separately.