Texas Attorney General Ken Paxton is suing Allstate insurance company for allegedly illegally collecting, using and selling the driving behavior data of over 45 million Americans.
Paxton filed the suit in the District Court for Montgomery County, Texas, on Monday morning. In the suit, he accuses Allstate, and its subsidiary data analytics company “Arity,” of secretly using driving data from over 45 million Americans’ mobile devices, in-car devices and vehicles to build the “world’s largest driving behavior database,” consisting of “trillions of miles” worth of data.
“Our investigation revealed that Allstate and Arity paid millions of dollars to install Allstate’s tracking software,” Paxton said in a Monday statement. “The personal data of millions of Americans was sold to insurance companies without their knowledge or consent in violation of the law. Texans deserve better and we will hold all these companies accountable.”
Allstate is one of the largest auto, home and life insurance companies in the U.S. It is headquartered in Glenview, Illinois.
The suit said that in 2015, Allstate and Arity developed and integrated software into several third-party apps so that when a consumer downloaded these apps onto their phone, they unwittingly downloaded the tracking software. Once Allstate’s software was downloaded onto a customer’s device, they could monitor the consumer’s location and movement in real time.
According to the suit, the company used the driving data to justify raising customers’ insurance rates and further profited by selling the data to third parties, including other insurance companies.
“Defendants [Allstate and Arity] never informed consumers about their extensive data collection, nor did Defendants obtain consumers’ consent to engage in such data collection,” the suit said. “Finally, Defendants never informed consumers about the myriad of ways Defendants would analyze, use, and monetize their sensitive data.”
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Because tens of millions of Americans, including millions of Texans, were never informed about their driving data being gathered, Paxton argues that Allstate’s data-gathering scheme violates the Texas Data Privacy and Security Act, the Data Broker Law, and the Texas Insurance Code’s prohibition on unfair and deceptive acts and practices in the insurance business.
He is asking the court to permanently block Allstate from continuing to gather and use customers’ data and to impose thousands of dollars in civil penalties per customer.
According to Paxton, this suit is the first enforcement action ever filed by a state attorney general to enforce a comprehensive data privacy law.
Fox News Digital reached out to Allstate but did not immediately receive a response.
