Automakers have entered into a controversial practice of collecting data on the driving behaviors of Americans, which is then passed on to a data broker, subsequently shared with insurance companies.
Kenn Dahl, a 65-year-old resident of Seattle, Washington, found himself among many American drivers experiencing steep rises in car insurance rates. Despite being a conscientious driver with no history of accidents, Dahl was stunned when his insurance costs surged by 21% in 2022. Even quotes from alternative insurance providers proved exorbitant. Dahl’s shock was compounded when an insurance agent cited his LexisNexis report as a contributing factor.
LexisNexis, a New York-based data broker, specializes in providing risk assessment data to the auto insurance industry. Utilizing information on driving histories, accidents, and traffic violations, LexisNexis assists insurers in evaluating policyholder risk levels.
Upon Dahl’s inquiry, LexisNexis furnished him with a comprehensive “consumer disclosure report” mandated by the Fair Credit Reporting Act. Spanning 258 pages, the report meticulously detailed every trip taken in Dahl’s leased Chevrolet Bolt over the preceding six months – totaling 640 trips. Each entry included trip dates, durations, distances traveled, and instances of speeding, hard braking, or rapid accelerations. Notably absent was data on the specific locations visited.
One such entry highlighted a Thursday morning drive in June, noting a 7.33-mile journey within 18 minutes, along with two instances of rapid acceleration and two instances of hard braking.
Remarkably, the report revealed that trip data was sourced from General Motors, the manufacturer of Dahl’s vehicle. LexisNexis spokesperson Dean Carney clarified that this data aids in assessing driver behavior and generates risk scores for insurers to tailor insurance coverage accordingly.
The revelation of LexisNexis’ collaboration with automakers to formulate risk assessments for insurers has intensified concerns over intrusive data collection practices. Accusations abound regarding surreptitious surveillance of motorists by car-related entities, utilizing sensors to monitor driving habits, acceleration, braking, and speed.
In a bid to justify premium adjustments, insurance companies leverage this data, obtained clandestinely through collaboration with auto manufacturers. Despite prior resistance from consumers towards third-party tracking devices, insurers have circumvented opposition by procuring data directly from car sensors.
For Dahl and others, this covert manipulation of personal data feels like a violation of trust. “It felt like a betrayal,” Dahl lamented. “They’re taking information that I didn’t realize was going to be shared and screwing with our insurance.” As the debate surrounding data privacy and consumer rights rages on, the implications of such practices on insurance premiums and driver autonomy remain contentious issues.
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