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What Data Does Telematics Actually Collect?
When you sign up for a usage-based car insurance (UBI) program, you're agreeing to let your insurer monitor your driving — but "monitor your driving" is a major understatement. Modern telematics programs collect a surprisingly broad range of data points, going well beyond simply logging how many miles you drive.
The Core Data Points
The following table shows the most commonly collected data categories across major telematics programs in 2026:
| Data Type | What's Tracked | Why Insurers Use It |
|---|---|---|
| Speed | Real-time speed, speeding frequency | Predicts accident risk |
| Hard Braking | Sudden stops, braking force | Signals aggressive or distracted driving |
| Rapid Acceleration | Fast starts, flooring the gas | Associated with higher crash risk |
| Time of Day | When trips occur (night vs. day) | Nighttime driving is statistically riskier |
| Mileage | Total miles driven | More miles = more exposure |
| Location (GPS) | Routes, addresses visited | Used to verify trips and map risk zones |
| Phone Use | Detected distracted driving | Major crash risk factor |
| Cornering | Sharp turns, lateral movement | Indicates aggressive driving style |
Beyond these fundamentals, some programs go even further. Depending on the insurer and platform, your telematics program may also capture weather conditions during trips, vehicle diagnostics like battery and engine health, whether adaptive cruise control or seatbelts are in use, and even vehicle performance data in modern connected cars.
How Data Gets Transmitted
Telematics data is collected through one of three methods: a plug-in OBD-II device that connects to your car's diagnostic port, a smartphone app that uses your phone's sensors and GPS, or built-in connected vehicle technology embedded by the manufacturer. Smartphone-based programs require permissions including location access, Bluetooth connectivity, and sometimes accelerometer data to function properly.
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How Insurers Use Your Data — and Who Else Sees It
How Your Insurer Uses It
The stated purpose of telematics data is simple: to price your policy more accurately based on how you actually drive, rather than relying on broad demographic averages. Safe, low-mileage drivers are supposed to benefit the most. Learn more about how car insurance premiums are calculated to understand how telematics fits into the broader pricing picture.
But there's a darker side to how this data gets used. Your telematics data can be used against you in accident claims to argue comparative negligence — potentially reducing your compensation even if another driver was primarily at fault.
The Third-Party Data Problem
Here's where car insurance telematics privacy concerns get serious. In a major 2025 scandal, it was revealed that data brokers like LexisNexis Risk Solutions and Verisk Analytics had been purchasing driving behavior data from automakers and mobile app developers — sometimes without drivers' explicit knowledge or consent. Companies like Allstate and its subsidiary Arity were alleged to have paid mobile app developers to secretly install tracking software, collecting personal data from tens of millions of Americans.
In January 2025, the Texas Attorney General filed suit against Allstate and Arity, alleging collection and sale of telematics data from over 45 million Americans. A separate class action in 2025 alleged that Toyota, Progressive, and a data broker collected not only location and vehicle data, but also image, voice, and other personally identifiable information — some of which allegedly ended up with marketing agencies and law enforcement.
Data Retention and Security Risks
Data retention policies vary widely between insurers and are rarely prominently disclosed. What we do know is that telematics data — once collected — may persist in insurer and third-party systems for years. This creates real security risks: a data breach exposing your precise GPS history, daily routines, and behavioral patterns would be far more damaging than a breach of basic contact information.
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Is the Savings Worth the Privacy Trade-Off?
What You Can Actually Save
The savings from telematics programs are real — for the right drivers. On average, safe drivers can save anywhere from 10% to 40% on their auto policy by participating in a usage-based insurance program. Consumer Reports found a median savings of $120 annually across all users, rising to $245 for policies with younger drivers. Nationwide's SmartRide advertises up to 40% for safe drivers, while Progressive Snapshot averages around $146 per year in savings.
However, not all enrollees see a reduction. Driving habits that algorithms flag as risky — including frequent nighttime driving, hard braking events, or high mileage — can result in higher premiums at renewal.
Privacy vs. Savings: A Side-by-Side Look
Alternatives to Telematics
If you're uncomfortable with the data collection involved in telematics programs, you still have options:
- Shop and compare traditional quotes — Comparing rates across multiple insurers can yield savings comparable to telematics discounts, especially if you have a clean driving record.
- Pay-per-mile insurance — Options like Mile Auto use odometer photos instead of GPS tracking, giving you mileage-based pricing with minimal data collection. Learn more about pay-per-mile car insurance and whether it's right for your situation.
- Bundle your policies — Combining auto and home insurance typically yields 10–25% discounts without any driving data involved.
- Loyalty and safe driver discounts — Many insurers offer meaningful discounts for multi-year customers and those with clean driving records — no app required.
- Higher deductibles — Opting for a higher voluntary deductible can significantly reduce your premium without any privacy trade-offs.
Your Rights and State Privacy Regulations
What Rights Do You Have?
Telematics participation is generally voluntary — you cannot be forced to enroll in a program by your insurer. However, some insurers may charge higher rates for drivers who decline participation, framing telematics as a "discount" rather than a penalty for refusal.
If you participate, your rights include the ability to request what data has been collected and to ask for deletion in states with applicable privacy laws. But given that data ownership laws remain legally unsettled at the federal level, enforcement of those rights varies significantly by state.
State Regulations: What's Changing in 2026
Regulatory action around telematics privacy has accelerated significantly heading into 2026. Here's a snapshot of key state developments:
| State | Legislative Action | Status |
|---|---|---|
| California | AB 1833 (Consumer Driving Data Protection Act of 2026) — limits data use to insurance rating only, requires deletion on request | Active 2026 |
| California | SB 354 (Insurance Consumer Privacy Protection Act) — broad insurance data framework, penalties up to $1M | 2025 |
| California | CCPA now applies to insurers for data not covered under Insurance Code (as of Jan 1, 2026) | In Effect |
| Texas | AG sued Allstate/Arity over data collection on 45M+ Americans | Ongoing |
| North Carolina | HB 81 — requires written consent from policyholders | Active |
| Maryland | SB 984 — requires disclosure of what data is collected | Proposed |
| Tennessee | SB 195 — requires consent and data collection disclosures | Proposed |
California is leading the charge. The state's CPPA issued its first auto-related enforcement action against an automaker in early 2025, resulting in a $632,500 fine for privacy violations related to data collection practices. California's AB 1833 would specifically prohibit insurers from sharing telematics data with anyone other than contracted telematics providers — and would require data deletion upon consumer request.
If you're enrolled in a telematics program, check whether your state has active privacy legislation and read your insurer's full privacy policy carefully. Understanding usage-based car insurance and its regulatory landscape can help you make a more informed decision.
Frequently Asked Questions
Does telematics insurance track your exact location?
Yes, most telematics programs that use smartphone apps or plug-in OBD-II devices collect GPS location data to verify trip details and map driving routes. This means insurers can potentially see not just how fast you drove, but where you went. Some programs, like odometer-photo-based pay-per-mile plans, offer mileage-based pricing without continuous GPS tracking and are worth considering if location privacy is a priority.
Can insurance companies sell your telematics data to third parties?
Yes — and this has been at the center of major lawsuits in 2025 and 2026. Data brokers like LexisNexis and Verisk have been purchasing driving behavior data from automakers and app developers, which is then used to influence insurance pricing. States like California are actively legislating to restrict this practice, but as of 2026 there is no comprehensive federal law prohibiting the sale of telematics data.
Can your rates go up because of telematics?
Absolutely. While telematics programs are marketed as discount opportunities, the driving score your insurer calculates from your data can trigger a rate increase at renewal if it reflects riskier behavior. Frequent nighttime driving, hard braking, rapid acceleration, and distracted driving behaviors are common factors that can negatively impact your score. Not all insurers raise rates — programs like Nationwide SmartRide and State Farm Drive Safe & Save are notable for not penalizing poor scores — but many others can and do.
What should you do if you want to opt out of telematics tracking?
Contact your insurer directly and confirm in writing that you are declining participation in their telematics program. Be aware that declining may result in a higher base rate if the insurer structures telematics as a discount from a higher standard premium. Also review your vehicle manufacturer's connected services terms, as your car itself may be transmitting driving data independently of any insurer app.
Are there ways to save on car insurance without telematics?
Yes — several effective strategies don't require any driving data. These include comparing quotes across multiple insurers, bundling auto and home insurance for multi-policy discounts, maintaining a clean driving record for safe driver discounts, raising your deductible, and exploring pay-per-mile plans that rely on odometer photos rather than GPS tracking. Even without telematics, dedicated comparison shopping can often uncover savings of 15–30% on your annual premium.