Allstate Corporation (ALL) has been ordered by a federal judge in Chicago to face a proposed class action lawsuit alleging the company tracked drivers through their cellphones without consent and attempted to profit from the collected data [1]. The lawsuit accuses Allstate of illegally gathering detailed cellphone information, including location, speed, braking, acceleration, and phone use, and using this data to raise premiums, deny coverage, and sell it to other insurers [1]. Drivers may also seek to prove that Allstate’s data analytics arm, Arity, violated federal law by misreporting driving behavior [1]. The tracking software is alleged to have been built into apps such as GasBuddy, Fuel Rewards, Life360, and Routely [1].
The judge allowed drivers to proceed with claims under the laws of 20 states, while dismissing three of the 38 claims in the case [1]. The lawsuit consolidates 15 separate suits filed against Allstate [1]. Allstate argued that drivers did not claim the company actually collected their data or raised insurance rates, and stated its privacy policies made clear that data could be collected [1]. In response, Allstate told FOX Business that consumers who choose to share driving data through Arity-powered apps receive clear notice and an explicit opt-in process, enabling access to emergency assistance, fuel efficiency tracking, and personalized insurance rates [1].
Insurance companies including Allstate, Progressive, and Geico use telematics technology to track driving behavior, claiming it can reward safe drivers with lower premiums [1]. Additionally, in January 2025, Texas Attorney General Ken Paxton filed a similar lawsuit accusing Allstate and Arity of unlawfully collecting, using, and selling Texans’ cellphone location and movement data through software embedded in mobile apps, including Life360 [1].
Market reaction to the news was muted, with Allstate shares (ALL) closing at $212.32, up $0.70 or 0.33% [1]. Attorneys for the plaintiffs could not be immediately reached for comment [1].
CONCLUSION
Allstate faces significant legal challenges regarding alleged unauthorized cellphone tracking and data usage, with a federal judge allowing most claims to proceed. Despite the lawsuit, Allstate shares showed little immediate negative impact, suggesting investors are awaiting further developments. The outcome of these legal proceedings could have broader implications for telematics and privacy practices in the insurance industry.