General Motors reached a massive financial settlement of $220 million with the U.S. capital Washington and 35 states, after attorneys general from those states joined a lawsuit against the automaker. This move came against the background of the revelation that the company shared its driving monitoring system data with data brokers, who in turn sold it to insurance companies.
General Motors had marketed the Smart Driver system as a useful tool to help parents monitor their teenage children's driving behavior or to track personal driving patterns. However, reports emerged in 2024 revealing that this data was shared without sufficient disclosure, leading to higher insurance policy rates for some drivers who were surprised to find their information shared without their prior knowledge or clear consent.
Previous Settlements and System Termination
Last year, General Motors and its subsidiary OnStar entered into a separate settlement with the Federal Trade Commission (FTC), which was finalized last January. That agreement prohibited the two companies from sharing geolocation data or driving behavior with third parties for five years, and also prompted the company to permanently shut down the SmartDriver system across all its models at the time.
What Does the New Settlement Entail?
The current settlement with the states includes prominent additional conditions, most notably the imposition of an independent third party to evaluate General Motors' compliance with the new privacy program and its strict terms.
In an official statement, General Motors commented that safe, more useful, and personalized experiences are enabled through connected vehicle data, affirming its full commitment to being clear about the information used, how it is protected, and the choices available to customers regarding what they share.