Texas AG sues Allstate, Arity for alleged unlawful data collection

TEXAS ATTORNEY GENERAL KEN PAXTON IS SUING ALLSTATE AND IT’S SUBSIDIARY, ARITY, FOR ALLEGEDLY UNLAWFULLY COLLECTING THE DATA OF MORE THAN 45 MILLION AMERICANS AND THEN USING THE INFORMATION TO RAISE INSURANCE RATES.

PAXTON CLAIMS ALLSTATE AND ARITY “WOULD PAY APP DEVELOPERS TO INCORPORATE ITS SOFTWARE TO TRACK CONSUMERS’ DRIVING DATA,” THE RELEASE STATED.

ACCORDING TO THE LAWSUIT, ALLSTATE EMBEDDED SOFTWARE IN THIRD-PARTY APPS, SO CONSUMERS UNKNOWINGLY DOWNLOADED THE SOFTWARE. ONCE INSTALLED, IT ALLOWED ALLSTATE TO TRACK THEIR LOCATION AND MOVEMENTS IN REAL TIME, CREATING THE “WORLD’S LARGEST DRIVING BEHAVIOR DATABASE.”

THE LAWSUIT CLAIMS ALLSTATE AND OTHER INSURERS USED THE CONSUMER DATA COLLECTED THROUGH THE THIRD-PARTY APPS TO RAISE PREMIUMS WHEN QUOTES WERE REQUESTED OR COVERAGE RENEWED.

PAXTON RELEASED A STATEMENT SAYING IN PART: “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.”

PAXTON ALLEGES ALLSTATE’S ACTIONS VIOLATED THE TEXAS DATA PRIVACY AND SECURITY ACT (“TDPSA”) WHICH IS A LAW REQUIRING CLEAR NOTICE AND INFORMED CONSENT REGARDING HOW A COMPANY WILL USE TEXANS’ SENSITIVE DATA. HE SAYS ALLSTATE NEVER PROVIDED NOTICE NOR OBTAINED TEXANS’ CONSENT TO COLLECT OR SELL THEIR SENSITIVE DATA.

A REPRESENTATIVE FOR ALLSTATE CORPORATION, HOWEVER, TELLS FOX NEWS THAT ITS DATA COLLECTION SYSTEM “FULLY COMPLIES WITH ALL LAWS AND REGULATIONS.”

PAXTON IS SEEKING THOUSANDS OF DOLLARS IN CIVIL PENALTIES PER VIOLATION AS WELL AS “FULL RESTITUTION OR RESTORATION TO ALL THE CONSUMERS WHO SUFFERED A LOSS.”