Allstate Faces Lawsuit Over Alleged Unauthorized Sale of 45 Million Americans’ Location Data

Allstate Faces Legal Challenges Over Location Data Practices

In today’s digital landscape, an increasing number of apps request location permissions. This is particularly necessary for platforms like Google Maps, Uber, or DoorDash, which rely heavily on geographic data. However, many applications unrelated to navigation also seek access to location information. Often, users grant these permissions without careful consideration.

When users provide location access to an app, that data is stored and can sometimes be sold. Recently, Texas Attorney General Ken Paxton brought attention to this troubling trend in a lawsuit against Allstate Insurance Company. The lawsuit claims Allstate unlawfully gathered and sold the location data of over 45 million Americans.

A Shift in Data Practices

In a press release, Attorney General Paxton revealed the specifics of the lawsuit against Allstate and its subsidiary, Arity. He accused the companies of collecting, utilizing, and selling data related to the location and movements of people’s smartphones. The serious nature of these allegations stems from the use of secretly implemented software in popular mobile applications, such as Life360.

According to the press release, Paxton stated, “Allstate and other insurers then used the covertly obtained data to justify raising Texans’ insurance rates.” Allegedly, the insurance provider amassed trillions of miles worth of location data from 45 million individuals across the nation. This extensive data collection purportedly facilitated the creation of the “world’s largest driving behavior database,” which Allstate leveraged to justify increases in car insurance premiums when customers sought quotes or renewed their policies.

Legal Violations and Consumer Concerns

Paxton further argues that Allstate’s actions violated the Texas Data Privacy and Security Act. According to the lawsuit, customers were not adequately informed that their data was being collected and did not provide consent for such practices.

Paxton emphasized the seriousness of the issue, stating, “Our investigation revealed that Allstate and Arity paid mobile apps millions of dollars to install Allstate’s tracking software. 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.”

Broader Implications for Data Privacy

The controversies surrounding Allstate’s data practices add to a growing narrative around the privacy of consumer information. Car manufacturers have likewise faced scrutiny; last year, Paxton sued General Motors for allegedly collecting and selling private driving data from more than 1.5 million Texans without their knowledge or consent. Even data brokers frequently purchase such data, often leaving it unprotected and vulnerable to cybercriminals.

Adding to this narrative of insecurity, earlier this month, hackers claimed to have breached Gravy Analytics, a significant location data broker. This company is known for selling smartphone location data to government entities, raising further questions about data security and privacy.

Protecting Your Privacy: Practical Steps

With concerns about unauthorized data collection rising, individuals can take proactive steps to safeguard their privacy:

• Avoid Unnecessary Apps: Refrain from installing the apps of insurance companies unless absolutely necessary. Instead, manage your account through the website or customer service.
• Limit Location Permissions: Be discerning when granting location access to apps. Assess whether an app genuinely needs specific data to function.
• Regularly Review Permissions: Periodically check which apps have location access on your device and revoke permissions from those that do not require it.
• Disable Location Services: Turn off location services when they are not in use to reduce passive tracking by apps.
• Use Privacy Tools: Consider using virtual private networks (VPNs) to help protect your general location online and prevent tracking.

Time to Prioritize Accountability

If Allstate is indeed involved in unlawful data practices, it is imperative that Attorney General Paxton’s lawsuit holds them accountable. In a time when cybercriminals search for new avenues to exploit personal information, companies that do not prioritize consumer data protection must face consequences. In the digital age, personal data has become a valuable commodity, often at the expense of individuals’ privacy rights.

The dialogue surrounding data practices emphasizes the need for transparency and accountability. It raises important questions about whether companies like Allstate should provide clear disclosures regarding their data practices to consumers. Understanding customer data sharing policies is essential for building trust between companies and the public.

Have your say on this issue: Should companies be mandated to clarify their data practices to customers? Engage with us to share your thoughts.