GM Offering “Free” Car Insurance with Car Purchase

While options such as OnStar and high-end entertainment remain on the menu for new car buyers in General Motors showrooms, the automaker has partnered with MetLife to throw in a “free” year of car insurance as a new feature for buyers in the Pacific Northwest.

The promotion only applies to buyers in Oregon and Washington State of any new 2010, 2011, or 2012 GM model – Chevrolet, Buick, GMC and Cadillac – and includes cars, trucks, and crossovers. The actual insurance policy includes liability, collision, and comprehensive coverage. Buyers who decline the offer and select to purchase their own car insurance will receive no discount, other than any incentives or rebates available on the specific make and model they select.

According to MetLife, the policy features a “new car replacement” provision for any car that it totaled in the first 15,000 miles or first year of ownership. During this period of time, the included policy requires no deductible or other out-of-pocket costs for consumers, not even for the depreciation of the value of the automobile.

After the policy ends, consumers have the choice of either renewing with MetLife, or selecting their own insurer. According to the Insurance Information Institute (III), policyholders in Oregon pay an average of $727 annually for their auto insurance, while those in Washington pay an average of $840. The national average cost for auto insurance is $789 a year.

While General Motors has issued a statement claiming that the promotion looks to help combat the uninsured motorist issues plaguing the nation, plus to gauge the appeal of including insurance in the price of its automobiles, we’re convinced the real goal is to sell more cars. The company does not yet know if the promotion will be rolled out on a nationwide basis. For those in Oregon and Washington, the promotion runs through September 6, 2011.