General Motors offers free car insurance on new models
Consumers who live in Oregon or Washington and purchase a 2010, 2011 or 2012 model from Buick, Cadillac, Chevrolet or GMC between now and September 6th will not only get all of the standard features included such as warranties but they will also receive a one year auto insurance policy from MetLife. GMs goal is to streamline the buying process by literally making your new Cadillac, Buick, Chevy or GMC vehicle ready to drive when you step out of the dealership. Also, this will save those new buyers the added expense of insurance coverage for the first year – including liability and collision coverage with new car replacement services if the vehicle is totaled within the first year or 15,000 miles (whichever comes first). This new program also applies to those who lease a new GM vehicle in those two states but it does not apply to fleet and commercial buyers.
If you have ever purchased a new car, one of the considerations is how much you will have to pay for insurance for this new vehicle but thanks to General Motors – those buyers will not need to worry about that for the first year. That means that if you live in Oregon or Washington and you buy a new Cadillac, Buick, GMC or Chevrolet before September 6th, you won’t need to consider additional costs from insurance when you purchase that new car, truck or SUV. It also means that while you are driving your new GM vehicle, you have a year to shop around for the most cost effective insurance plan that fits your needs.
So, why Oregon and Washington? Well, those two states’ auto industries are dominated by Asian and European competition so in an effort to stand out from the crowd and attract more buyers in those areas, GM has become the first to offer this interesting incentive of free insurance. There are other states (like California) where GM would probably like to get a leg-up on the competition but in those areas, insurance rates are higher on average so the program would cost GM more money in the long run. However, depending on the positive impact of this new program in the first two states; this could, in theory, be a strong selling point for GM all over the country. I think that it is a fantastic idea, lowering the cost of ownership and taking one of the headaches out of new car buying but with costs of insurance varying so much around the US - it's hard to say whether they could ever offer this on a national level.
Every automaker offers your basic warranties, cash incentives and special interest rates on financing but in the long run, when every company in the segment offers those features they become perks more than something that helps the company stand out in the industry. Companies have come up with different ways to stand out against their competition such as Hyundai offering deferred payments if you lose your job after buying a new car but GM is the first to offer a free insurance program – clearly helping them to stand out against their competition in Oregon and Washington (the state, not the DC).