The emergency vehicle alarm system and method allows a user to select an emergency vehicle alert as a telematics service in a mobile vehicle. Once the user selects the alert service, a telematics operations center determines a service fee, bills the user, and debits the user's account accordingly. The emergency vehicle alert telematics service warns a civilian vehicle of an approaching emergency vehicle. The system includes a transmitter located in the emergency vehicle that transmits a signal adapted for reception by a receiving module of a telematics system located in the civilian vehicle. When the emergency vehicle signal is received by the receiving module in the civilian vehicle, an audio and/or visual alert is generated to alert the occupants of the civilian vehicle that an emergency vehicle is nearby. The civilian vehicle's telematics system may also display relative positioning of the emergency vehicle and the civilian vehicle.