When Romeo Chicco tried to get auto insurance in December, seven different companies rejected him. When he eventually obtained insurance, it was nearly double the rate he was previously paying. According to a federal complaint filed this week seeking class-action status, it was because his 2021 Cadillac XT6 had been spying on him.
Modern cars have been called “smartphones with wheels,” because they are connected to the internet and packed with sensors and cameras. According to the complaint, an agent at Liberty Mutual told Mr. Chicco that he had been rejected because of information in his “LexisNexis report.” LexisNexis Risk Solutions, a data broker, has traditionally kept tabs for insurers on drivers’ moving violations, prior insurance coverage and accidents.
When Mr. Chicco requested his LexisNexis file, it contained details about 258 trips he had taken in his Cadillac over the past six months. His file included the distance he had driven, when the trips started and ended, and an accounting of any speeding and hard braking or accelerating. The data had been provided by General Motors — the manufacturer of his Cadillac.
In a complaint against General Motors and LexisNexis Risk Solutions filed in the U.S. District Court for the Southern District of Florida, Mr. Chicco accused the companies of violation of privacy and consumer protection laws. The lawsuit follows a report by The New York Times that, unknown to consumers, automakers have been sharing information on their driving behavior with the insurance industry, resulting in increased insurance rates for some drivers. LexisNexis Risk Solutions, and another data broker called Verisk, claim to have real-world driving behavior from millions of cars.
In his complaint, Mr. Chicco said he called G.M. and LexisNexis repeatedly to ask why his data had been collected without his consent. He was eventually told that his data had been sent via OnStar — G.M.’s connected services company, which is also named in the suit — and that he had enrolled in OnStar’s Smart Driver program, a feature for getting driver feedback and digital badges for good driving.
Mr. Chicco said that he had not signed up for OnStar or Smart Driver, though he had downloaded MyCadillac, an app from General Motors, for his car.
“What no one can tell me is how I enrolled in it,” Mr. Chicco told The Times in an interview this month. “You can tell me how many times I hard-accelerated on Jan. 30 between 6 a.m. and 8 a.m., but you can’t tell me how I enrolled in this?”
A spokeswoman for G.M., Malorie Lucich, previously said that customers enrolled for SmartDriver in their connected car app or at the dealership, and that a clause in the OnStar privacy statement explained that their data could be shared with “third parties.” Asked about the lawsuit, she said by email that the company was “reviewing the complaint,” and had no comment, pointing instead to a statement the company previously gave about OnStar Smart Driver.
“G.M.’s OnStar Smart Driver service is optional to customers,” the statement 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.”
LexisNexis Risk Solutions, which previously said it analyzed the sort of driving data that Mr. Chicco found in his file to create a risk score that it then sold to insurers, declined to comment.
“I would never have given permission for this data to go out there,” Mr. Chicco previously said. Reached after the lawsuit was filed, he said he had no comment.
David Vladeck, a Georgetown law professor who previously ran the bureau for consumer protection at the Federal Trade Commission, said that the driving data companies were collecting was considered very sensitive, meaning there should be “clear notice” to consumers and explicit consent for its collection and sale.
Mr. Vladeck said he would expect an investigation by the F.T.C., as well as lawsuits by consumers against the automakers and data brokers.
“Just wait for the avalanche,” he said. “It’s coming.”
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.