Insurance

General Motors ready to get into the car insurance market under its OnStar umbrella

OnStar Insurance Services will launch later this year.

Photo courtesy of General Motors

OnStar is best known as the service that activates when you press the button in your General Motors car. It can do any number of things from emergency dialing to concierge-like service. Now, GM is looking to add one more aspect to its OnStar roster - insurance.

GM's new insurance agency, OnStar Insurance Services, will be the exclusive agent for OnStar Insurance. In a release, GM said that they intend to offer "a secure, fair, personalized and easy-to-use digital insurance experience for drivers".

The insurance plan will integrate with drivers' existing OnStar services and presumably provide a great deal of data to OnStar and GM regarding daily habits of the vehicle's driver(s) and safety as part of the program.

OnStar Guardian app OnStar recently released the Guardian app, which untethered users from their vehicle and allowed them to take their services with them. Photo courtesy of General Motors

OnStar Insurance is aiming to provide insurance that is secure, fair, personalized, and easy to use. "OnStar Insurance will promote safety, security and peace of mind," said Andrew Rose, president of OnStar Insurance Services. "We aim to be an industry leader, offering insurance in an innovative way. GM customers who have subscribed to OnStar and connected services will be eligible to receive discounts, while also receiving fully-integrated services from OnStar Insurance Services."

The junction of the two arms of OnStar will allow customers to have their vehicle's Automatic Crash Response activated in the event of a collision, then have an OnStar Emergency-certified Advisor can send help. From there, OnStar might be able to access telematics, safety system, and infotainment data to determine the cause of the crash and begin the repair process without having to wait for coordinated responses from numerous parties as would traditionally occur when a crash happens.

OnStar is working with vehicle insurance providers to devise a plan that will focus on a customer's precise risk factors to determine the price, including individual vehicle usage and driving habits. The company says that those with "smart driving habits" should be rewarded. Several insurance companies currently offer discounts like this. OnStar looks to also provide feedback to drivers.

OnStar Insurance Services seeks to create a centralized location for customers' automotive insurance needs. It is likely that this means that a buyer can purchase a vehicle from a dealership with insurance and their OnStar safety system subscription built into the contract.

Starting with Arizona residents, OnStar Insurance Services will initially offer OnStar Insurance to GM employees in Q4 2020, expanding to additional customers, including the general public, in early 2021.

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Honda notified dealers of upcoming supply cuts.

Photo courtesy of American Honda Motor Co., Inc

Honda, like all major automakers today, is truly a global operation. Though it produces plenty of vehicles here in the United States, many of the components it relies on for manufacturing come from elsewhere in the world. That means Honda, like the other auto giants, needs its global supply chain operating smoothly in order to prevent disruption. Unfortunately for Honda dealers and potential customers, disruption is what's about to happen. The automaker recently sent a letter to its dealers, forecasting reduced vehicle supply in the coming weeks.


2021 Honda Ridgeline No. 19 - Honda Photo courtesy of American Honda Motor Co., Inc


The dealer letter, posted to the Civic XI forum and fan site, was dated August 25 and confirmed by a dealer upset with the development, according to Automotive News. In the letter, Honda cites the ongoing pandemic and microchip shortages as major factors impacting its production efforts. Total shipments to dealers could be cut by up to 40 percent, but not all models will be affected to the same degree.

The letter noted that supplies of the Pilot and Passport SUVs will hold steady, and shared that production of the Civic hatchback is on schedule. However, the situation is fluid and could change at any time, so there's a chance that timelines could speed up or slack off as necessary.


2022 Honda Pilot Some models will see more cuts than others.Photo courtesy of American Honda Motor Co., Inc


Honda is just the latest in a long line of automakers struggling to keep pace with demand in the face of several converging global crises. In an effort to keep vehicles rolling out of factories, General Motors has implemented selective feature cuts in some of its new vehicles, such as the removal of engine start/stop tech from some trucks and SUVs. Earlier this month, Ford Motor Company told Mustang Mach-E buyers to expect delays of at least six weeks as it grapples with the chip shortage, and will temporarily reduce production capacity at a few of its plants.

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Biden will target 50 percent of all vehicle sales for EVs by 2030.

Ford

In the last several months, we've seen automakers from all corners of the globe commit to some degree of electrification by the end of the decade and beyond. That includes the American Big Three: Ford Motor Company, General Motors, and Stellantis (Chrysler, Dodge, Jeep, others). Today, President Joe Biden plans to throw his weight behind these efforts by signing an executive order that sets a goal of pushing the sales of zero-emissions vehicles to half of all vehicle sales in the U.S. by 2030.

Biden's target is not legally binding, but the industry is already jumping on board. In a joint statement, Ford, General Motors, and Stellantis confirmed that they aim to hit an EV sales volume of 40-50 percent annually. It's worth noting that the President's 50 percent goal and the automakers' sales targets also include plug-in hybrid vehicles, which still use a traditional gasoline engine.


Jeep PHEV The target also includes plug-in hybrid vehicles, which still use gas engines.Jeep


Auto unions and dealers are not opposed to the ambitious roadmaps laid out by the Big Three, but both have differing views on what is essential and how things will ultimately play out. While aware of the goals, the UAW is focused on wage growth and the preservation of jobs and benefits. It feels that an increase in EV production volume must happen here in the U.S. to include good-paying American union jobs.

Dealers, to a degree, are supportive of the goals but skeptical of their ultimate success. Some feel that electric vehicles do not present the earth-shattering shift in functionality and usability that other new products, such as smartphones, did in different industries. Regardless of concerns and skepticism, it appears that automakers are going all-in on the shift to electrification, so we're bound to see a wealth of new battery-electric and plug-in hybrid vehicles in the next few years.


GM battery facility rendering Automakers are pledging billions to increase EV and PHEV production volume.GM

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