In an era marked by regulatory scrutiny from the Financial Conduct Authority (FCA), particularly regarding finance commissions and GAP insurance, used car dealers are increasingly turning to self-administered warranties as a means to preserve healthy profit margins.
This shift reflects a broader industry trend towards more transparent, customer-focused practices and financial prudence.
Cost Savings and Enhanced Control
Self-run warranty schemes are not just a reaction to regulatory pressures; they offer tangible benefits. By managing warranties in-house, we’ve seen our members save over 75% of what they spent on traditional insurance-backed warranties. This significant cost reduction, coupled with direct oversight of the claims process, allows dealers to offer better value to customers while maintaining control over service quality.
Compliance and Customer Satisfaction
Our evaluations reveal that some insurance-backed warranties fall short of the protections guaranteed by the Consumer Rights Act 2015. By managing warranties in-house, dealers can directly address customer concerns and provide tailor-made solutions, ensuring consumers receive fair treatment and clear information, aligning with the FCA’s objectives.
Don’t settle for less
In conclusion, the transition to self-run warranty schemes is more than a strategic move; it’s a declaration of independence from restrictive, often unsatisfactory insurance-backed warranties. The benefits are clear: substantial cost savings, enhanced control over the claims process, and an ability to offer truly customer-focused solutions.
At Lawgistics, we support this shift and want to highlight the valuable resources available to our members, including our warranty management system. This tool helps simplify the process of issuing warranty documents, managing claims, and keeping an eye on your warranty fund. It’s all about providing excellent service to your customers while safeguarding your profit margins.
For those looking to delve deeper into the mechanics of self-run warranties and the potential benefits, more information is available in our article The Advantages of Self-Funded Warranties for Used Cars.
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