The company had originally said conversations within Allo would be only temporarily stored on its servers, restricting the authorities' ability to request access.
However, the Verge news site revealed that Google now holds on to the data unless users take active measures to stop it.
Google has confirmed the U-turn.
Privacy campaigners say the public must be kept informed about how their records are handled.
"It's important that citizens are given enough information about what will happen to their data for them make an informed choice about whether or not they want to use this service," said Daniel Nesbitt, research director at Big Brother Watch.
"This includes who may be able to access it and where the data will be stored".
Allo was first announced at the Google IO event in May.
At the time, it said chat records would be "transiently" stored on its servers.
This was required to provide the app's standout feature - the inclusion of the Google Assistant, a tool that provides context-relevant suggestions.
For example, if two people are discussing Italian food, the Assistant can be asked within the conversation to give details of nearby restaurants or how to prepare a dish.
Google's support documents state that a user can opt to wipe their chat history and add that it holds onto people's data to provide them with "a more personalised experience".
But when first asked, the firm was unable to clarify whether it had abandoned plans to delete chats without being prompted.
Allo itself handled privacy queries by providing a link to the Verge.
However, a spokeswoman later confirmed the change of policy.
"We've given users transparency and control over their data in Google Allo," she told the BBC.
"Our approach is simple - your chat history is saved for you until you choose to delete it. You can delete single messages or entire conversations."
Allo does offer an Incognito mode - which encrypts the chats in a form that prevents the Assistant listening in or the authorities being able to get an unscrambled copy - but this is not enabled by default.
"Google has a challenge as there are already a lot of big players with chat apps with very established audiences," said Jack Kent, from the IHS Technology consultancy.
"With messaging it's not just about acquiring one user, it's about acquiring the network of users.
"Google is trying to do that by offering a smarter messaging experience, and to do that it needs the data to learn about its users.
"But it needs to be careful about how it communicates that."