Cory Collins, national training director for Automotive Reinsurance Concepts, encourages finance managers to offer only vehicle service contracts with exclusionary coverage.
"If you're not offering it, please start," Collins told an Independent Dealer University webinar May 5. Exclusionary coverage lets a dealership distinguish its coverage from competing products featuring a specified-parts format. Exclusionary coverage protects everything except the items listed on the contract. Specified-parts contracts protect only the items listed.
In addition, when the customer seeks to use the service after a breakdown "your phone call goes completely different," Collins said. The odds are good the customer's issue will be addressed. In a specified-parts or tiered contract "there's a chance it's not going to be."
Even if you explained the contract perfectly, the customer won't appreciate the distinction. "They remember that they paid you money for a service, and now they need to use it and it doesn't work," he said.
Have a good finance and insurance tip to share? Submit it to John Huetter at [email protected] and Gail Kachadourian Howe at [email protected].
