The short answer is yes, but we would say that, wouldn’t we? More seriously, the real reason this question arises comes from a poor reputation which the warranty market has developed. Whether we underwrite or promote warranty products, we need to face up to this reality, do something about it and change perceptions.
“It’s not what you are, it’s what people think you are that is important” – Joseph Kennedy
JFK’s father is credited with these words and as a business that is passionate about the warranty market, we would like consumers to think positively about what we believe is a valuable product. As an industry, we rightly place great emphasis on treating customers fairly (TCF) and this is a powerful message we need to get across.
Perceptions and misconceptions
Here are a couple of perceptions that are really misconceptions.
Warranty insurance claims are not paid – Reports show that Ford and GM pay out $3 and $4 billion per year, respectively. Also, at White Oak, we offer A-rated cover which should give confidence that we can and will pay claims.
The cost of cover outweighs the benefits – This is an interesting one. How do you measure the cost against peace of mind and the anxiety of an unexpectedly high repair bill? Also, in the event of a claim you do not have to search around for a repairer, nor do you need alternative quotes to mitigate against that nagging doubt that you could be over charged.
5 warranty insurance benefits
- Asset protection Investing in a new, or for that matter used vehicle can be a huge outlay. So, thinking about the cost of repairs may not be top of the mind when taking ownership of that new set of wheels. It could be months or possibly years without any repairs. The problem is that you can never predict when your prized asset may fail and how you would manage in getting to work, shopping, the school run or on that much-needed holiday.
- Complexity – The days of poking around under the bonnet with a screwdriver in the event of a breakdown are consigned to the past. While vehicles are more technically stable, they are also far more sophisticated. This means that they often need specialist expertise to get them back on the road.
- Labour – research has shown that nearly half of drivers surveyed were unaware that labour costs are covered under a warranty policy. This means that the product is effectively undervalued. After all, those parts will not fit themselves.
- Stress – We are all increasingly time poor and could really do without the hassle of sorting out the repair of our car. Even if you own a new car that is still under warranty, it will expire and research shows that people are hanging onto their cars longer. In Britain, the average age of a car on the road is 8 years, and in the US this jumps to over 11 years.
- Value – According to a report in Parkers, each of the top 10 warranty claims all cost more than the annual price of a warranty policy. Also, with consumers keeping their cars for longer it makes sense to be prepared for unexpected repairs.
If you would like to know more about Warranty cover please contact your local broker, or we can put you in touch with one.