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OnStar Offering Insurance

Leveraging connectivity for advantage

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What

OnStar, the connectivity service that General Motors launched in 1996, is entering the insurance business. OnStar Insurance Services, which will launch in Arizona and then be rolled out to the general public in early 2021, is taking advantage customer’s use of OnStar services.

Quote

“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,” said Andrew Rose, president of OnStar Insurance Services.

Observation

Tesla has rolled on an insurance platform. Traditional insurance companies are offering drivers the possibility of getting driver discounts by plugging a dongle into their OBD II ports that transmit driving information to the carrier.

So like the case of Tesla, OnStar-equipped vehicles have the modem ready, so there’s no need for the dongle.

Those who drive carefully are going to benefit. And so is GM, presumably, as it has the opportunity to monetize the data that is associated with accumulating lots of data about drivers—drivers who have opted in to the program.

The future for OEMs: Data monetization.

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