We came across an interesting article published by the New York Times recently entitled, “Automakers Are Sharing Consumers’ Driving Data With Insurance Companies.” It’s worth a read! Note: the article may be behind a paywall for some people.
We’ve known for some time that driving data can be shared with insurance companies. In many cases, consumers may opt-in to provide their driving data to insurance companies in order to receive preferred rates. Some insurance companies will work with devices plugged into a car’s OBD2 port, which is a standard device port that all modern cars have. We think it’s great when consumers are given the choice about if and when their driving data is sent to insurance companies.
If you read the above article, however, it talks about how G.M. can send driving data to insurance companies without most consumers being aware of it. And we think this is a bad idea. Consumers need to be informed and they need to consent to have their data sent to insurance companies. Without this critical aspect of awareness and consent, consumers may be stiffed with higher premiums than they were expecting – and for a longer period than they would ever expect – based on factors that they were simply unaware of.
Part of our continuing education for insurance professionals, and the reason we offer CE credits for insurance, is to educate insurance professionals in Canada about practices like this. While this information isn’t a course in and of itself, the topic touches on a number of critical factors that people need to be aware of.
UPDATE!
There’s an update to this news story. Ars Technica writes about how GM has now decided to stop sharing driver data with insurers following a backlash by the public. And rightly so.
It took General Motors less than a week to make this decision. We think most people would agree that consumers should explicitly opt-in for this type of data sharing so we applaud GM’s decision. It’s likely they’ll start giving consumers a choice soon about the sharing of their driving data with insurers.
In Conclusion
We cover some of these ethical considerations in our course, Ethical Challenges in Digital Transformation which primarily looks at the use of artificial intelligence and machine learning in the insurance industry.
Later on in 2024 we’re planning to build and published a number of new General, Property & Casual CE courses for continuing education credit that focuses on ethical concerns like the one in this article. Stay tuned. Until then, it’s simply good to be aware of these ethical considerations when you deal with your clients.
Try us for all your insurance CE credits this year!
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