DETROIT (USA) — Two US senators are urging the Federal Trade Commission to investigate car manufacturers selling customer driving data to brokers who then package and sell it to insurance companies.
In a letter to FTC Chairman Linda Kahn, Sens. Ron Wyden, D-Oregon, and Edward Markey, D-Massachusetts, allege that General Motors, Hyundai, Honda, and possibly others share driver data, including on hard braking and acceleration.
The senators said in a statement Friday that automakers used tactics to mislead customers into agreeing to disclose their data to brokers.
After reading the New York Times article, Wyden’s office investigated the three automakers and found they had shared data with broker Verisk Analytics. All three companies acknowledged disclosing the data, the senators wrote in their letter to Khan. GM also acknowledged disclosing customer location data to two other companies, the letter said, but the company did not name them.
Verisk used the data to create reports about driving behavior and sell them to insurance companies, the senators wrote. Some automakers may have misled customers by promoting the data disclosure as a way to reduce premiums and not telling them that some insurers could charge them more, the senators wrote.
“If the FTC determines that these companies violated the law, we urge it to hold the companies and their senior executives accountable,” the senators wrote to Khan.
In the letter, GM did not disclose how many vehicles it sent data to the brokers or how much it was paid. Wyden’s office found that Hyundai shared data on 1.7 million vehicles and received just over $1 million, while Honda received just under $26,000 for data on 97,000 vehicles, the senators said.
A message seeking comment was left with the FTC after business hours Friday.
In an email, GM denied that it misled customers into signing up for the data-sharing program with Verisk. GM said its data-sharing partnerships with Verisk and LexisNexis were terminated in March and that its data-sharing program, called “Smart Driver,” was shut down in June.
“Data was only shared with insurance companies if the customer requested a quote directly from their chosen insurer and provided separate consent to that insurer,” the email said.
The company said it shares “anonymized” data with partners to help city infrastructure and make roads safer.
Hyundai said in a statement that the senators’ letter misinterpreted its data policies and that it has safeguards in place to ensure customers consent to sharing driving information with insurers.
Through Verisk, customers can link their driving scores to insurance companies and receive benefits like good driving discounts, the company said.
“It’s important to note that Verisk was not authorized by Hyundai or its customers to share DriveScore data with its insurer until the customer gave express consent on the insurer’s website or app,” Hyundai said.
Honda also said customers had to opt in to Verisk’s program. Some customers with good driving records were given the opportunity to accept discount offers from the insurer. “Without a clear second opt-in by the customer, no identifiable consumer information will be shared with any insurance company,” Honda said.
Verisk also disagreed with Wyden and Markey, saying in a statement that it “takes action to ensure that access to and use of data is appropriate.” The company said using data responsibly “is a cornerstone of our business.”