Who's Offering OEM Insurance — and How It Works

Automakers selling insurance is no longer a futuristic concept — it's happening right now. Tesla, General Motors, Honda, and Rivian have all stepped into the insurance market, using the connected technology already built into their vehicles to assess risk and price premiums. Instead of relying on traditional factors like age, gender, or credit score, these manufacturer-owned programs tap directly into your car's onboard systems to understand how you actually drive.

This approach — often called Real-Time Insurance or telematics-based insurance — marks a fundamental shift in how auto coverage is priced and sold. Rather than buying a policy from a third-party insurer who knows little about your specific vehicle, you're buying from the entity that built it. Learn more about how usage-based insurance programs work and how much they can realistically save you.

The global vehicle insurance market is valued at approximately $1.17 trillion in 2026 and is projected to grow at an 8.6% CAGR through 2033. Within that, OEM and embedded insurance channels are among the fastest-growing segments — driven by connected vehicle adoption, AI-powered underwriting, and automaker-insurer API integrations. Tesla alone has scaled to $747 million in written premiums for the first nine months of 2025. For consumers, that growth translates to more options — and more pressure on traditional insurers to compete.

The Major OEM Insurance Players in 2026

Here's a look at the automakers currently offering their own insurance programs and what makes each one unique:

Tesla Insurance

Tesla Insurance is the most prominent and mature OEM program on the market. Tesla prices premiums using a proprietary Safety Score system that tracks hard braking, aggressive turning, unsafe following distance, forward-collision warnings, and Autopilot disengagement events. No additional hardware is required — Tesla uses sensors already embedded in the vehicle.

New policyholders start with a default Safety Score of 90, and as your monthly score improves, your premium drops. Tesla also offers a Full Self-Driving (FSD) discount that scales with the percentage of miles driven using FSD over a 30-day rolling period — the more FSD-engaged miles, the larger the discount on eligible policy portions. This per-mile FSD discount is currently available in Florida, Texas, and Arizona. Notably, California does not use the Safety Score for pricing due to state insurance regulations.

Expansion update: Tesla Insurance expanded to Florida in early 2026 and filed for a March 2026 launch in Tennessee — its 14th U.S. state — ending a multi-year expansion pause. The program has also updated certain coverage limits as of August 2025.

In January 2026, Lemonade launched a competing pay-per-mile Tesla insurance product offering approximately 50% off per-mile rates for miles driven with FSD engaged, using Tesla's Fleet API to detect FSD mode in real time. The program launched in Arizona (January 26) and Oregon (February 2026), with further state expansion planned. This signals growing third-party competition in the Tesla-specific insurance space.

GM Insurance

General Motors offers GM Insurance through its OnStar ecosystem, covering Chevrolet, Buick, GMC, and Cadillac vehicles. GM Insurance uses OnStar telematics to monitor driving behavior — including acceleration, braking, cornering, speed, seat belt usage, and mileage — and bases rates on actual driving habits. The program prioritizes OEM parts in claims and integrates directly with the vehicle's existing connectivity platform.

Important regulatory update: In January 2026, the FTC finalized a settlement order against GM and OnStar for collecting and selling precise geolocation data and driving behavior information from millions of vehicles without adequately notifying consumers or obtaining affirmative consent. Key terms include a 5-year ban (through 2031) on sharing geolocation or driving data with consumer reporting agencies, and 20-year requirements (through 2046) to obtain affirmative express consent before collecting or sharing vehicle data — with options for consumers to access, delete, or disable precise location tracking. This is a landmark case with lasting implications for all OEM insurance programs. Learn more about how telematics privacy concerns are shaping the future of usage-based insurance.

Honda Insurance Solutions

Honda entered the insurance space through a partnership with VIU by HUB, a licensed omnichannel insurance brokerage. Honda's program covers automobiles, motorcycles, homes, RVs, and more, and is available across all 50 states. One standout feature: Honda does not use driving behavior data to set rates — a deliberate privacy-forward differentiator from Tesla and GM. Honda also offers optional OEM parts coverage, ensuring that accident repairs use genuine Honda and Acura Genuine Parts.

Rivian Insurance

Rivian offers its own Rivian Insurance program, available in all U.S. states and Washington D.C., designed specifically for its electric vehicles. The program integrates with Rivian's connected vehicle platform and its Driver+ ADAS suite — including adaptive cruise control, automatic emergency braking, and lane-keeping assist — to track driving quality and potentially reduce premiums. Rivian also allows multi-vehicle bundling for additional discounts. The 2026 R1S earned IIHS TOP SAFETY PICK+, which may support future discount eligibility. Average full coverage costs for Rivian models range from roughly $2,800–$4,400 per year, reflecting the elevated repair complexity of electric vehicles.

How Vehicle Data Powers OEM Insurance Pricing

The core advantage OEM insurers have over traditional carriers is data depth. When you buy insurance from your car's manufacturer, they already have access to every sensor, every alert, and every system interaction your vehicle generates. This is also what makes telematics-based OEM programs uniquely powerful compared to third-party devices.

What Data Is Tracked?

This granular data allows OEM insurers to build a far more precise picture of your actual risk compared to traditional insurers who estimate risk based on demographic proxies.

Privacy Tradeoffs and Regulatory Scrutiny

The same data richness that enables better pricing also raises serious concerns — and regulators are taking decisive action. In January 2026, the FTC finalized its settlement order against GM and OnStar after allegations that they collected and sold "precise geolocation data and driving behavior information from millions of vehicles" without adequately notifying consumers or obtaining their affirmative consent. This data was reportedly sold to consumer reporting agencies and used to affect insurance rates — without drivers knowing.

The order sets an industry precedent: a 5-year ban on selling geolocation and driving data to consumer reporting agencies, and 20-year requirements to obtain affirmative express consent before any vehicle data is collected, used, or shared — including consumer options to access, delete, and disable location tracking. Texas had previously sued an insurer and analytics affiliate for allegedly collecting over 45 million Americans' driving data in violation of state privacy laws.

Before enrolling in any OEM insurance program, consider these real risks:

• Data monetization: Who owns your driving data and can it be sold to third parties?
• Claims disputes: Could your own vehicle's data be used against you in a claims investigation?
• Liability in autonomous driving: As automation increases, data may be used to determine fault between driver and software

For more on how this is evolving, see our guide on autonomous vehicle liability and coverage responsibilities as these systems become more advanced. You can also explore how software-defined vehicles are reshaping OTA update liability and cybersecurity risks.

OEM Insurance vs. Traditional Insurance: Costs and Coverage

What Does OEM Insurance Actually Cost?

For Tesla vehicles in 2025–2026, full coverage insurance through any provider runs higher than average due to expensive repair costs. EVs generally cost 40–50% more to insure than comparable gas vehicles — with the national EV insurance average reaching approximately $4,050 per year in early 2026 — due to higher repair complexity, proprietary parts, and battery replacement exposure:

Tesla Insurance's own pricing can be 20–40% below these market averages for safe drivers, thanks to the Safety Score system. However, unsafe drivers may see their premiums climb above market rates. For a full breakdown of EV insurance costs across all brands, see our electric vehicle insurance guide.

OEM Parts Coverage: A Hidden Advantage

One major financial benefit of manufacturer insurance is the guarantee of OEM parts in repairs. Traditional insurers often use cheaper aftermarket components to reduce claim costs — parts that may not fit as precisely or carry the same warranty as factory originals. This is especially important for electric vehicles, where battery systems, sensors, and proprietary components are costly and complex to replace correctly.

This guarantee has become significantly more valuable in 2026. The 25% tariffs on imported auto parts — effective since May 2025 — have pushed OEM parts prices up sharply, with retail OEM prices rising 2.1% from Q1 to Q2 2025 alone (double the rate of 2024). Roughly 44% of OEM parts used in U.S. collision repairs are sourced outside the U.S., meaning tariff exposure is significant. For a deeper look at why this matters, see our guide on OEM parts coverage and how auto tariffs are driving up repair costs in 2026.

The Future of OEM Insurance

The automaker insurance market is growing fast, and the competitive pressure on traditional carriers is real. The car insurance industry trends shaping 2026 point clearly toward more embedded, telematics-driven, and manufacturer-linked coverage options for consumers.

Expanding Third-Party Competition

OEM insurance is no longer just manufacturer vs. traditional insurer. Third-party insurtechs are now using OEM vehicle APIs to offer aggressive, behavior-based products. Lemonade's January 2026 FSD insurance launch — offering 50% off per-mile rates for autonomous miles — is the clearest example yet of how OEM vehicle data is becoming the foundation for next-generation insurance products, even from outside the manufacturer.

Deeper Integration With Autonomous Driving

As vehicles reach higher levels of autonomy, self-driving car insurance will evolve significantly. California's Assembly Bill 1777 (effective July 2026) now holds AV manufacturers and operators directly liable for certain traffic violations, while the federal SELF DRIVE Act — introduced February 2026 — aims to clarify NHTSA authority and improve crash data transparency. The landmark $242.57M Benavides v. Tesla verdict (upheld February 2026) further underscores how liability is increasingly shifting from driver to manufacturer — reshaping how OEM insurers underwrite risk. Learn about the insurance challenges specific to software-defined vehicles as autonomy and OTA updates become standard features.

Embedded Insurance Expansion

Honda and Rivian represent a newer wave of OEM insurance entrants, and embedded insurance — coverage offered directly at the point of vehicle purchase — is expanding rapidly. The North American embedded auto insurance market is estimated at $28 billion in 2026, with major growth projected through 2030 as connected car data, API integrations, and consumer appetite among younger buyers accelerate adoption. Other automakers are following suit: Toyota partners with Toggle/Nationwide, BMW with Wrisk, and Stellantis with Bolttech. Learn more about how embedded car insurance programs at dealerships are changing the way consumers shop for coverage.

What This Means for Consumers

More competition is generally good news for drivers. The rise of OEM insurance programs will pressure traditional carriers to offer better usage-based car insurance discounts and more transparent pricing. Smart shoppers should always compare their manufacturer's insurance offering against traditional options — your vehicle make and model have a significant impact on which insurer will offer you the best rate. Learn how car insurance rates in 2026 are trending and whether switching programs could lower what you pay.

Frequently Asked Questions

Q: Is Tesla Insurance cheaper than traditional car insurance? Tesla Insurance can be significantly cheaper for safe drivers — potentially 20–60% below market rates — thanks to the monthly Safety Score system. However, drivers with aggressive habits may pay more than they would with a standard carrier. Third-party competitors like Lemonade now also offer pay-per-mile Tesla policies with up to 50% off for FSD-engaged miles, launched in Arizona and Oregon in early 2026 with more states planned. Always compare quotes from multiple insurers before committing, as traditional rates vary widely by ZIP code and driving history.

Q: What data does GM Insurance collect through OnStar? GM Insurance uses the OnStar telematics platform to monitor a wide range of driving behaviors, including acceleration, braking, cornering, speed, seat belt usage, and mileage. In January 2026, the FTC finalized a landmark settlement against GM and OnStar for collecting and selling this data — including precise geolocation — without adequate consumer consent. The order requires GM to obtain affirmative express consent before collecting or sharing vehicle data for 20 years (through 2046) and bans sharing driving data with consumer reporting agencies for 5 years (through 2031). Always review a program's privacy policy before enrolling.

Q: Does Honda Insurance track my driving habits? No — Honda Insurance, offered through its VIU by HUB partnership, explicitly does not use driving behavior data to set rates. This makes it a strong privacy-forward option for drivers who want the convenience of manufacturer-affiliated coverage without the telematics monitoring required by Tesla or GM programs. The Honda program is also available in all 50 states, making it the most geographically accessible OEM insurance offering available today.

Q: Why does manufacturer insurance guarantee OEM parts in repairs? When you're insured through your vehicle's manufacturer, there is a strong business incentive to use original factory parts — it protects the brand's reputation and ensures vehicles are restored to their original safety specifications. Traditional insurers typically default to cheaper aftermarket parts to reduce claims costs, which can affect fit, function, and even warranty coverage on newer vehicles. This benefit is especially valuable in 2026, as 25% tariffs on imported auto parts have pushed OEM parts prices up meaningfully — making the guarantee worth more in real-dollar terms than in prior years.

Q: Should I switch to my car manufacturer's insurance program? It depends on your driving habits, privacy comfort level, and what states you're eligible in. If you're a consistently safe driver who values seamless claims handling and guaranteed OEM parts, a manufacturer program could offer significant savings — Tesla has now expanded to 14 states as of early 2026. However, be aware of the FTC's landmark January 2026 action against GM/OnStar — a clear signal that regulators are scrutinizing how OEM programs collect and share your driving data. Always compare at least 3–4 quotes, including your OEM option and third-party telematics programs, before deciding.