Hyundai and Kia are being sued for allegedly collecting personal information such as drivers’ driving habits and driving data through smart connectivity applications and secretly selling it without the consent of the vehicle owners. The claim is that insurance companies that received this driver information analysed the drivers’ driving habits, such as acceleration and sudden braking, and used them to raise vehicle insurance premiums, causing damages.
According to federal court documents, a Hyundai car owner named Mark Will (who lives in Illinois) recently filed a class action lawsuit against Hyundai and Kia, claiming that he was harmed by the automakers’ actions. In the complaint filed with the Federal Court for the Central District of California on July 29, the Hyundai owner claimed that “Hyundai and Kia shared the details of the vehicle owners’ driving data applications with data trading company Verisk Analytics, which then passed them on to auto insurance companies, which ultimately used them to calculate individual insurance premiums.”
Plaintiff Mark Will bought a new Hyundai Santa Fe in 2019, and between December 2023 and April 2024, Hyundai shared data about his driving habits with Verisk, which then passed that information on to the insurance company, causing Will’s insurance premiums to increase by about $250, according to the law firm Keller Roback in Santa Barbara, which represented the lawsuit. The plaintiffs allege that Hyundai’s Blue Link and Blue Link+, and Kia’s Kia Connect, commonly referred to as “connected car” applications, were originally intended to provide emergency services and promote safe driving, but Hyundai and Kia invaded drivers’ privacy and caused economic harm, such as higher insurance premiums, by sharing their data with data trading companies without their consent.
The defendants in the class action lawsuit include Hyundai and Kia in South Korea, their U.S. subsidiaries Hyundai Motor America and Kia America, and Verisk Analytics. The plaintiffs asked the federal court to order Hyundai and Kia to share driving-related information with data companies, along with actual and punitive damages through a jury trial. In relation to this, the New York Times (NYT) pointed out this issue in early March when it reported that some automakers, including Hyundai and Kia, were making millions of dollars a year by using customer driving data through transactions with auto insurance companies.
At the time, the NYT reported that “various driving information, such as hard braking or rapid acceleration while driving, is being secretly traded from automakers including GM, Hyundai, Kia, Mitsubishi, Honda, and Acura to auto insurance companies, and most customers are unaware that they have consented to the collection of such data.” According to the newspaper, some car owners have actually experienced increased insurance premiums due to driving habits such as speeding, sudden braking, and sudden acceleration, and in some cases, their auto insurance applications have been denied due to this.
The insurance companies cited driving habit data collected from smart connected applications as the basis for such measures. When such issues were raised, GM, which provides smart connection application services such as ‘OnStar’, announced at the end of March that it would be the first automaker to end data transaction contracts with data companies such as Verisk and LexisNexis.
At the time, GM spokesperson Kevin Kelly said, “Starting March 20, OnStar smart driver customer data will no longer be shared with LexisNexis and Verisk,” and “Customer trust is our top priority, and we actively comply with applicable policies related to customer personal information.”