Is your car spying on you? And upping the cost of your insurance. It turns out that's a growing problem, thanks to today's Internet equipped vehicles. It can occur without the driver's knowledge or permission. That's the finding of a recent New York Times piece by my next guest. Under the heading, automakers are sharing consumers driving behavior with insurance companies. So how is this happening? Well, in recent years, automakers, including GM, Honda, Kia, Hyundai, have started offering optiona
l features in their connected car apps that rate people's driving. If drivers enable these features on GM, it's called OnStar Smart Driver. Many don't realize the car companies then give information about their driving to data brokers. One such broker is LexisNexis, which has a Risk Solutions division serving the auto insurance industry and has traditionally kept tabs on car accidents and tickets. On the surface, it sounds sensible that an insurer would want to know a driver's record and people
who are safe. Drivers want credit for their habits. But as the Times reports, the existence of these partnerships is nearly invisible to drivers whose consent is obtained in fine print and murky privacy policies that few read. One Corvette driver was surprised his data was collected during a track day while testing out the Corvette's limits on a professional racetrack. A Cadillac driver in Palm Beach County, Florida. Romeo Chicco was denied auto insurance by seven companies because his LexisNexi
s report detailed speeding, hard braking and accelerating. He ended up having to pay double his old premium. Chico says that although he had downloaded the My Cadillac app, he had not signed up for OnStar or Smart Driver. He's now suing GM and LexisNexis Risk Solutions, accusing them of violations of privacy and consumer protection laws. LexisNexis Risk Solutions declined to comment. But on Friday, GM released the following statement, quote, As of March 20, OnStar Smart Driver Customer data is n
o longer being shared with LexisNexis or Verisk. Customer trust is a priority for us, and we are actively evaluating our privacy processes and policies. Joining me now is Cashmere Hill, business features writer for The New York Times and author of the book Your Face Belongs to US A Secretive Startups Quest and Privacy As We Know It. CASHMERE Exactly. What type of information is being tracked? Yeah. So in these cases, they were tracking every trip, that trip that a person took in their car, inclu
ding when the trip started and ended, how many miles they drove and how many times they heartbreak, heart accelerated or sped went more than 80 miles per hour. So there's nothing new about associating the level of risk with one's premium. It seems to me, based on your reporting, that the issue here is really one of consent. Absolutely. Look, if we think that all drivers should have this data collected and be charged accordingly, that's a whole different conversation. In this case, it was happeni
ng secretly. I heard that story of Romeo, Chico. From so many drivers, they had no idea this data was being collected and they had no idea it was going to affect their insurance. And their insurance went up 20%, 50% doubling in some cases. You know, I discussed this on radio and I did hear from a number of callers who said that they'd signed up with USAA and had seen a reduction in premium and they welcomed it like, hey, I'm a safe driver. And if they want to track me with my permission, I'm coo
l with that. How often have you heard anecdotally of rates actually tumbling? I have not had anybody come to me and say that the secret monitoring led to their insurance rates being decreased. So what happens if it doesn't stop with just the insurance company? It occurs to me that the automobile manufacturers have the technology. What they get out of it is revenue. I assume, from selling your data, with your permission, we hope, onto the insurance broker. But who's to say that it's not just an i
nsurance company? I've got to believe there's a hypothetical of this going in all different directions that we might not welcome. Yeah, I mean, I think this story could be the tip of the iceberg. What is happening right now is that cars are becoming smart, few smartphones on wheels. You know, they are massive data collectors. They have hundreds of sensors and cameras in the car and they're collecting a lot of data about drivers and how they're driving. And I think that the automakers have realiz
ed that they can do what Silicon Valley has done, what Google and Facebook has done, find a way to monetize this data. And so there are likely other ways they're doing it. And this is just one of the programs where we're seeing that they have sold it to data brokers who then sold it to the insurance industry. Cashmere I referenced your reporting about GM, explained to me the change in their handling of this data. So GM announced this week that they are no longer going to be sharing data for smar
t drivers with LexisNexis Solutions or another data broker. They're selling to called Verisk. They said that customer trust is a priority for them and that they're reevaluating their their privacy policies and procedures here. My hunch is that people are watching us all across the country right now, and they're saying to themselves, hey, I wonder if I'm being tracked. So what can someone watching who's concerned do to figure out if that's the case? Yeah, I mean, in the case of GM, according to o
ne internal corporate document I saw, there were 8 million cars that were enrolled in this program. And so if you're wondering, hey, you know, is this happening to me, is data from my car being tracked? One look at your look at your car app, if you have one. If you have a connected car app, see if you're enrolled in one of these drivers for driver feedback programs, you can go to your automaker, you can request a privacy report and you can actually go to LexisNexis resolutions and request your c
onsumer disclosure report and find out whether your driving details are in there. What an eye opener. Thank you for the report. Cashmere Hill, We appreciate it. Thanks for having me on. Via social media from the world of X, what do we have, Catherine? What really sticks out to me is the absurdity department. What's it got taken off my screen? Credit. What was wrong with the other one? Inquiring minds want to know. Credit card companies and lenders get to see your spending patterns. Debt obligati
ons and credit worthiness. Why shouldn't an insurance company get to see more details on the kind of drivers they're considering insuring? Well, fee on Macau, I think you're right. I mean, if you're a skydiver, you ought to be paying more for your life insurance than somebody who doesn't skydive. I get it. There's there's nothing new associating risk with premium to me based on Kashmir's reporting and my conversation with her. It's all about consent. And look, I'm an attorney. I'm as bad as ever
ybody else. You arrive on a flight. You pick up the rental car. They put something in front of you. You just sign it. You're tired. You want to keep moving. In this case, the consent needs to be, like, really obvious. Hey, we're going to track all this information and determine your premium as a result. And if they're doing that, then I'm cool with it.
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