Can an Insurance Tracking Device be Used to Deny my Claim?

A lot of car insurance companies offer tracking devices drivers can install in their vehicles to potentially reduce their premiums. Essentially, these tracking devices reward drivers for safe driving.

However, insurance companies are focused on their bottom lines. That raises the question: what else might the insurance company be tracking with these discount devices? And how might they use that data in the future?

Below, the our car accident attorneys in Fort Worth discuss the risks of having an insurance tracking device in your vehicle, particularly after a crash that was not your fault.

Risks of Using Car Insurance Tracking Devices

Potential for Increased Premiums and Financial Implications

Yes, telematics can raise your rates if misinterpreted. While these devices are marketed as money-saving tools, they can just as easily result in higher premiums. A tracking device might flag you for hard braking or driving late at night—activities that don’t always reflect reckless driving. Unfortunately, insurers may not consider the context behind these actions.

• Inaccurate or incomplete data caused by glitches may misrepresent safe driving behavior.
• Occasional speeding or emergency maneuvers can be interpreted as habitual risk, even when isolated.
• Premium hikes based on skewed data can be difficult to contest once logged.

Even worse, insurers may treat this data as more objective than it actually is, relying on flawed metrics to determine risk profiles and adjust your rates accordingly.

Privacy Concerns and Data Security

Your driving habits—and more—could be exposed. Most tracking devices collect sensitive information: speed, braking habits, location, time of day, and even routes. While this may seem harmless, it can open the door to privacy violations.

• Apps may run in the background, logging location data even when you’re not driving.
• Insurance carriers may share your driving profile with third parties, such as data brokers or advertisers.
• Encryption doesn’t guarantee protection—hacking incidents and breaches are still a real threat.

According to the National Association of Insurance Commissioners, while telematics programs promise transparency, the balance between safety and data exploitation remains underregulated in many states, including Texas.

Device Malfunctions and Technical Issues

Even a small error in data capture can cost you. No technology is foolproof. Telematics devices, especially aftermarket plug-ins, are prone to technical faults. These may include hardware failure, incorrect installation, or battery drain.

• Interference with GPS or vehicle systems can compromise more than just your insurance tracking.
• Poor calibration can result in inaccurate readings for acceleration, braking, or speed.
• Connectivity dropouts may log partial trips or miss crucial data altogether.

Such errors, while technical, can lead to tangible consequences, including claim denials and inflated premiums.

Over-Reliance and Potential for Complacent Driving

Trusting the device too much may distort safe driving awareness. When drivers rely heavily on these tools to validate their driving behavior, they may develop a false sense of security.

• Some risky behaviors aren’t tracked, like distracted driving or rolling stops.
• Drivers may focus on “gaming the system” rather than cultivating safer habits.
• Real-world context is often missing, meaning the data might tell a partial or misleading story.

This detachment can reduce situational awareness, which is critical in complex driving conditions, especially on high-speed Texas highways.

Potential Impact on Accidents and Claims

Yes, insurers can use your driving data against you. In Texas, personal injury claims often hinge on comparative fault rules. Data from a tracking device could be cited as evidence that you contributed to an accident, even if another driver was primarily at fault.

• Insurers might argue that your recorded behaviors show negligence, influencing liability.
• Claims may be disputed based on driving patterns, like late-night driving or sudden stops.
• Settlements may be reduced if the data paints you as a partial contributor under Texas’s 51% rule.

Even if you weren’t driving at the time of the crash, the vehicle’s recent data might still be factored into the insurer’s decision-making process, raising questions about responsibility and eligibility for compensation.

How do Insurance Tracking Devices Work?

The official name for these tracking devices is telematics devices. Although each company has a different trademarked name, they essentially all do the same thing: track your driving.

These devices connect to your vehicle’s computer system and send data back to the insurance company for interpretation, such as data on:

Data on speed and mileage help insurers determine your driving patterns. Insurance companies may also use these devices to track where you park and the places you frequently visit. For example, if you park your car in an area with high rates of burglary or vehicle theft, your insurance premium may increase. The insurance company is trying to protect itself in case your car gets stolen or damaged in a burglary incident.

Other Data Insurance Companies May Collect

Not only do these telematics devices collect your driving habits and track you using GPS, but they could also potentially be collecting other data such as phone call records or other data available through your Bluetooth devices.

It is unclear how well insurance companies secure this data and whether it is encrypted, so your sensitive information could potentially be exposed.

Another risk of using telematics devices is that insurance companies may be able to sell your data to third parties, like advertisers, for a profit.

How Can my Data be Used Against Me?

The data collected from a telematics device may be used to review your driving patterns and, if you are filing a claim for an accident, it could be used to deny your claim based on something as minuscule as driving five miles over the speed limit. Luckily, our attorneys are prepared for situations where the insurance company baselessly denies a claim.

That said, you should be cautious about agreeing to install a telematics device in your car. How much money would it really save you each month? If the answer is not that much, does it make sense to give the insurance company data that may be used against you?

You should also consider the insurance company’s reasons for asking you to use the device. Is it because they want to save you money? Is it because they want to collect more data about you to serve their interests?

Call to Ask for Legal Assistance

Insurance companies deny claims for many reasons. Hiring an experienced attorney who knows how these companies operate may give you a better chance at recovering the compensation you need for medical bills, lost wages and other damages.

Our attorneys are prepared to take on the insurance company on your behalf so you may focus on recovering from your injuries. We do not charge you anything up front or while we work to build your case, and we only get paid if we recover compensation on your behalf.

Call today to schedule your free consultation: (817) 920-9000.