Texas AG warns Kia about sharing driver information with data brokers

Texas told the auto manufacturer Kia America that it is violating the state’s new data privacy law because it allegedly sells sensitive driver information to third parties without informing consumers that the data can be used to hike their insurance premiums.

Attorney General Ken Paxton says that the allegedly illegal practice stems from Kia’s relationship with the data broker LexisNexis Risk Solutions and other companies Kia shares drivers’ data with.

The move comes five months after Texas filed a lawsuit against General Motors for selling driver data to third parties, including LexisNexis Risk Solutions. Earlier this month, the Federal Trade Commission announced a proposed settlement agreement with General Motors which prohibits the car company from sharing customers’ geolocation data with consumer reporting agencies and data brokers for five years.  

Kia allegedly deceived customers enrolling in its “usage-based insurance program” by only telling customers the program would make them “eligible for potential savings on [their] auto insurance premium,” according to a notice of violation sent to Kia.

In reality, Texas says, LexisNexis Risk Solutions and other companies Kia shared the data with were using it in a way that often raised consumers’ insurance premiums.

Texas says the alleged misrepresentation means that Kia effectively failed to get consumers’ consent for the data sharing.

Kia also allegedly did not tell consumers how it would process their sensitive data, failed to include “required notice” in its privacy policy and neglected to “clearly and conspicuously disclose the process by which it sells personal data to third parties,” the notice of violation says. 

A spokesperson for Kia America declined to comment saying the company does not publicly discuss pending legal matters.

The company has 30 days to address the violations Texas alleges, the notice says.