The Consumer Federation of America urged the California State Senate Appropriations Committee to oppose AB 311, a harmful bill that would allow the use of telematics without adequate consumer protections, including testing for unfair discrimination or algorithmic transparency.

In its introductory language, AB 311 invokes a paper published by CFA – Watch Where You’re Going: What’s Needed to Make Auto Insurance Telematics Work for Consumers – but the proposed legislation fundamentally ignores and contradicts a key feature of the model CFA proposes. CFA notes that “Regulators, policymakers, consumer advocates, and the public should be able to see how the algorithms work, what goes into the calculations and what comes out.” But AB 311 upends that and disregards Proposition 103’s mandate for transparency of rating rules and models, by allowing insurers to submit its telematics programs confidentially.

While telematics programs show some promise for encouraging safer driver behavior and reducing the number and severity of auto crashes, they need strong guardrails and active regulation to prevent unfair pricing, privacy risks, abuse of personal consumer information, and racial bias. AB 311 lacks these guardrails and has loopholes that will harm consumers and undermine Proposition 103’s protections.

The letter opposing AB 311 is available here.