General Motors has agreed to pay $12.75 million to settle allegations that it improperly collected and sold sensitive driver data from hundreds of thousands of California customers without clear consent. The settlement marks another major blow to the automaker following growing scrutiny around connected vehicle privacy and data monetization practices in the automotive industry.
The agreement was announced by California Attorney General Rob Bonta, whose office accused GM of secretly sharing customer information gathered through its OnStar and Smart Driver systems with third-party data brokers.
According to state officials, the company allegedly sold names, contact details, geolocation information, and driving behavior data to analytics firms including Verisk Analytics and LexisNexis Risk Solutions. The data was reportedly used to build consumer driving profiles and risk assessments.
California Says Drivers Were Not Properly Informed
The controversy first gained widespread attention in 2024 after reports revealed that several automakers were sharing driving data with insurance-related companies. Many drivers later claimed they saw unexpected increases in insurance premiums after their driving behavior was tracked.
California officials alleged that GM failed to properly inform customers about how deeply their data was being collected and monetized. The Attorney General’s office also stated that many users believed OnStar services were primarily for safety and emergency assistance, not for commercial data sales.
“General Motors sold the data of California drivers without their knowledge or consent,” Bonta said while announcing the settlement. He also stressed that companies cannot collect consumer data for one purpose and later repurpose it for profit without transparency.
However, the state clarified that the shared driving data did not directly affect insurance pricing in California because state insurance laws prohibit insurers from using such behavioral driving information to determine rates.
GM Ordered to Stop Selling Driver Data
As part of the settlement, GM must halt the sale of driving data to consumer reporting agencies for the next five years. The automaker has also agreed to delete any retained driver information within 180 days unless customers explicitly authorize the company to keep it.
Additionally, GM must request that both LexisNexis and Verisk delete any California driver data previously obtained through these programs.
The settlement follows a separate agreement GM reached earlier with the Federal Trade Commission over similar privacy concerns. That federal action also restricted the company and OnStar from sharing certain consumer data with reporting agencies.
GM Responds to the Allegations
In response, GM said the settlement relates to its discontinued Smart Driver program, which the company shut down in 2024 amid growing criticism over privacy practices.
The automaker stated that it has already implemented stronger safeguards and improved customer transparency regarding data collection and sharing.
GM added that it remains committed to giving users more control over how their information is used inside connected vehicle ecosystems.
The case is expected to intensify conversations around digital privacy in modern vehicles, especially as automakers increasingly rely on software services and connected technologies as new revenue streams. Consumer advocates say the settlement could push the broader auto industry toward stricter disclosure standards and stronger consent requirements for driver data collection.
