Should You Get Auto Insurance From GM OnStar Insurance?

It seems as if more companies than ever before are getting into the car insurance business -- and sometimes, car insurance companies are also car manufacturers. General Motors (GM) is now offering car insurance, called OnStar Insurance, that rewards safe driving. OnStar Insurance collects driving data from connected vehicles, an example of telematics car insurance.

Let's see what OnStar Insurance can offer, whether it can save you money on car insurance, and what features might make it a good deal.

OnStar Insurance: Telematics car insurance for GM vehicles

There are several car insurance companies that offer telematics insurance, a type of car insurance that creates personalized insurance rates based on people's everyday driving data. With telematics insurance, you can sign up to allow your car insurance company to collect data about your driving habits, such as how hard you accelerate or brake, and what times of day you drive. Telematics insurance lets insurance companies get more precise and personalized with insurance premiums. If you're a safe driver, you can prove it -- and get rewarded with cheaper car insurance premiums.

OnStar Insurance is unique, because it's a special telematics insurance program for GM vehicles (Buick, Cadillac, Chevrolet, or GMC) from model year 2016 or newer. These newer model GM cars have connected vehicle technology. With your permission, GM can use this connected vehicle technology to reward you for safer driving with OnStar Insurance. Unlike other insurance companies that use telematics, OnStar Insurance doesn't need to use any plug-in devices or mobile apps; your GM-connected vehicle is already equipped with the technology it needs.

How OnStar Insurance helps you save money

OnStar Insurance tracks data from your GM-connected vehicle and rewards you for safer driving behaviors in a few different ways. The OnStar Insurance technology measures:

• Seat belt usage: If you consistently buckle up, you can get discounts on car insurance.
• Smooth driving: OnStar Insurance rewards drivers who avoid aggressive acceleration or hard braking.
• Mileage and frequency of driving: People who drive less often (and fewer miles) are less likely to be in car crashes.
• Safe travel times: Driving late at night and early in the morning is riskier, because of limited visibility.
• Idle time: The more time you spend idling in traffic, the higher your risk of collision.

Along with lower rates for safer driving, OnStar Insurance offers extra rewards like Accident Forgiveness and Deductible Waiver.

OnStar Insurance: Pros and cons

Let's look at a few advantages and possible downsides of OnStar Insurance.

OnStar Insurance: Pros

• Get rewarded for safer driving: Just like other telematics car insurance programs, OnStar Insurance offers a personalized insurance option that can lower your rates.
• Special benefits for GM owners: OnStar Insurance offers special benefits for Buick, Cadillac, Chevrolet, or GMC vehicle drivers, such as loyalty discounts, and OEM Parts Coverage (this makes sure that, in case of a crash, your car gets repaired with GM Genuine Parts).
• Not limited to new GM vehicles: If you drive a non-GM vehicle, or an older GM vehicle without connected vehicle technology, you can still get OnStar Insurance. But it will be a traditional auto insurance policy without the telematics and rewards for safer driving.
• No OnStar subscription required: OnStar Insurance shares a brand name with GM's OnStar connected services, but you can get the auto insurance even if you don't have an OnStar plan.

OnStar Insurance: Cons

• Only available in a few states: As of Jan. 7, 2024, the company's website listed only three states where OnStar Insurance coverage was available: Arizona, Illinois, and Texas. Indiana, Ohio, and Pennsylvania were listed as "coming soon."
• Discounts are not clearly stated: Unlike other car insurance companies, OnStar Insurance doesn't advertise specific discounts on its website. You're welcome to get a free quote from OnStar Insurance, but it's not clear just how much you can expect to save.
• Your insurance rates could go up: Some insurance companies promise not to raise your rate if you use telematics programs. OnStar Insurance says that risky driving behavior could increase your rates; however, you also have the power to change your habits behind the wheel and get a discount.

Bottom line: If you're a loyal GM customer with a newer model vehicle, and you're curious about trying telematics insurance, OnStar Insurance could be a great way to save money on car insurance. You don't have to be a GM customer to get OnStar Insurance. But if you want a personalized insurance plan based on your driving data, you need a GM-connected vehicle. OnStar Insurance works with your car to reward you for safer driving, and offers some special benefits like Deductible Waiver and Accident Forgiveness.