Why You Need A Vehicle Service Contract

By: Jeff Hatch

October 19, 2017

Contemplating a vehicle service contract, but unsure of how it works or how it differs from an automotive warranty? You’re not alone. A lot of consumers tend to get the two mixed up or fail to understand just what they cover. But seeing as how your vehicle is usually the second most important purchase you will make right after your home, it is in your best interest to do your homework and make sure that you are protected.    
 
What exactly is a vehicle service contract? 
It is an agreement to cover costs associated with repairs or services made to your vehicle. A manufacturer’s warranty, on the other hand, is a promise from the manufacturer to stand by their workmanship for a limited time after you purchase the vehicle. Once this warranty expires, a vehicle service contract becomes valid and provides you with much-needed coverage on your vehicle’s most important systems and components. 
 
Is a vehicle service contract right for you? 
Here are a few things to consider:
 
Keep in mind that the average hourly rate for a mechanic is $100 an hour. A vehicle service contract can help do away with this cost, save you money and keep you from paying any unforeseen and unexpected repair bills. 
 
If you plan on owning your car for an extended period, it’s definitely in your best interest. A vehicle service contract can keep your car running at its very best and on the road for a long time. 
 
Even if you don’t intend to keep your car for long, a service contract can increase your vehicle’s resale value once you decide to sell. But before you do, make sure that the service contract you’re purchasing is transferable.  
 
Do some research into the make and model of the vehicle you plan on purchasing. Is it likely to need repairs and, if so, what are the costs? Weigh this against the price of the service contract to determine if it is worth it to you.
 
Does the contract include extras such as discounts on hotels and restaurants, rental car benefits, locksmith services and 24-hour roadside assistance? Not only do these add to the value of the service contract, they can provide you with added peace of mind in the event that something goes wrong while you’re on the road and away from home. 
 
Take your driving habits into account. Will you be on the road a lot? Is there a lot of stop-and-go traffic? What are the road conditions like? Do you park outside where the weather is extreme? These can all have an adverse effect on your vehicle. 
 
Check the terms and conditions carefully. Make sure you know exactly what you’re getting and what is covered specifically. 
 
In addition to the type of coverage, be mindful of the length of coverage, miles of coverage and deductible. 
 
Research the company providing the service contract. Are they reputable? Some guidelines to help determine this might include checking their Better Business Bureau rating to see how they work with consumers and finding out what their A.M. Best rating is to verify financial strength and stability. 
 
Have questions about a specific vehicle service contract? 
Don’t hesitate to ask your salesperson or agent for more information. Most dealerships typically provide you with a brochure or direct you to a website so you can review the plan in its entirety. Take time to make sure that you fully understand the scope of the service contract and don’t get pressured into purchasing something that makes you feel uncomfortable. With so many options currently available, you are sure to find something that is satisfactory for your budget and your vehicle’s specific requirements.
 
Visit us online to learn more about our available vehicle service contracts or call 800.833.8801 to speak with a customer service representative. We’re happy to help.

Filed Under: contract, service, vehicle, Warrantech, warranty

Building Blocks to Success: The Warrantech Advantage

By: Jeff Hatch

September 12, 2017

When choosing a provider for your extended service plan (ESP) program, it’s important to consider someone with the ability to adapt quickly to your company’s unique needs. The market moves fast and your ESP administrator has to be able to keep up in order to meet the growing and fluctuating demands of your business.
 
One of Warrantech’s core strengths is the scalability of our infrastructure. Rapid expansion capability is a hallmark of our business and woven into the very fabric of our company. As your needs change, our modular approach allows you to make changes to your program in order to reach your goals and, most importantly, maintain superior customer service and financial stability. 
 
Flexibility
Customized to grow with your needs
Program incubation and growth strategies
Complete training and support solutions
 
Transparency
Real-time program performance
Monetization of product performance data 
Pricing and underwriting data sharing
 
Scalability
State-of-the-art infrastructure and technologies 
Profit sharing / reinsurance / alternative risk transfer
Modular solutions
 
Dedication
Dedicated staffing model
Segregated data/systems
Creation of dedicated obligor company for your business
 
Execution
Industry expertise 
Proven implementation and project management expertise
Focused, entrepreneurial and accountable philosophy 
 
Financial Stability
A 2017 Fortune 500 company
Rated “A” (Excellent) by A.M. Best Company for financial strength and stability
Ranked 45 on Fortune magazine’s “Fastest-Growing Companies” list
Named Forbes’ “2014 Best-Managed Company (Insurance)”
 
To learn more about our customized extended service plan programs, visit warrantech.com or call 800.833.8801.

Filed Under: dedication, financial, flexibility, stability, transparency, Warrantech

Sean Stapleton To Speak At Extended Warranty & Service Contract Innovations Conference

By: Jeff Hatch

September 01, 2017

The eighth annual Extended Warranty & Service Contract Innovations Conference opens September 13 at the Renaissance Hotel in Nashville. Several hundred professionals from the extended warranty and service contract industry are headed to Nashville to talk about how changes in technology and regulations will impact their businesses in the years ahead.
 
Successful Partnerships 
 
On Thursday morning, Sean Stapleton, the President and CEO of AMT Warranty, will join with Kenneth J. Mac, the Director of Chevrolet-Buick-GMC-Cadillac Protection at General Motors Co., to deliver a presentation on "Successful Partnerships in the OEM F&I Space."
 
GM spun off its vehicle service contract, insurance, and finance business years ago into what is now known as Ally Financial Inc., but which used to be known as the General Motors Acceptance Corp. (GMAC). Then, of course, the great recession hit, and both GM and GMAC went through bankruptcy reorganizations. Afterwards, GM decided to re-enter the VSC business under its own name, and Mac's Customer Care & Aftersales unit decided to do it in partnership with an outside insurance underwriter.
 
Stapleton said AMT won the bidding after an extensive vetting process. "The relationship with GM has been truly phenomenal," he said. "We've been in business for many years now." He said they started working together in 2014, after AMT Warranty won the bid in late 2013.
 
"The program has grown tremendously since then," he said. "And it continues to grow. So I'm really proud of what AMT Warranty and GM have put together." Their joint presentation in Nashville will explain how the relationship works, how they strive for continual improvement and innovation together, and what advice they can offer to others looking to create similar partnerships for their service contract programs.
 
"It's a unique partnership in so many ways," Stapleton said. "This isn't a vendor relationship with them. We're not order-takers. It's very collaborative. We meet every Monday. We have our quarterly calls. We have update calls. We're living and breathing and looking at the same things."
 
Fear-Free Communications
 
Stapleton said he and Mac will outline some of the best practices that seem to work for them in their partnership, while acknowledging that things may be different for other partnerships. First, he said, the partners employ what he called "fear-free communications" between the two teams.
 
"We empower our teams to build these relationships amongst themselves," he said. "They fight for each other. It's almost like one organization. It doesn't feel like finger-pointing. It feels like we win or lose together."
 
The teams also are encouraged to ask a lot of questions, particularly around reasons why they're doing something a particular way. "Some of those things are hard to discuss, whether it's personal or professional, but we have that openness. And it's been really beneficial."
 
Stapleton said the partners started out in 2014 with just a handful of auto dealers selling their vehicle service contracts (most were still loyal to GMAC/Ally). Ally still had rights to the GM name. So the partners decided to sell Buick, Cadillac, and Chevrolet-branded VSCs, and gradually some of those dealers decided to come aboard.
 
"It was a huge challenge," Stapleton said. "But it was also a pretty exciting time -- to know that we were doing things differently, to do things that were intended to drive retention and loyalty. That's one of the biggest differentiators I think that the program has."
 
They also offered disappearing deductibles, and introduced a "white glove" level of service within the dealerships to boost loyalty and turn what could be a real negative (getting a defect repaired) into a real positive (cementing the relationship with a phenomenal experience).
 
"Issues create long-term relationships with these customers," he said. "Their alternator may have blown. And that stinks. But they had a great experience. They were put into a loaner car. And there's a disappearing deductible, so there's no money out of pocket. It makes it a whole lot easier, and it builds that level of trust. Challenges can actually result in longer-term relationships with customers."
 
GM could have done it alone, essentially remanufacturing GMAC all over again. But instead it decided to work with AMT. Stapleton said this allows the partners to share data about both the products and the risks, with each bringing their expertise to the table.
 
"We support other large OEM programs," he said. "So we know what's been successful, and we know what's been a failure." And it helps the partners to properly price the service contracts sold for not only for new GM vehicles, but also the used vehicles that dealers have on their lots. "We have a depth and breadth of understanding of this space that's hard to compete with, because this is our core."
 
Visit warrantyweek.com to read this article in its entirety and for more industry insight. 
 
And be sure to follow Warrantech on Facebook, Twitter and LinkedIn so you can keep up to date on company initiatives as they happen. 

Filed Under: AMT, conference, contract, extended, innovations, Sean, service, Stapleton, Warranty

AmTrust Financial Services, Inc. Strengthens Senior Management Team with Appointment of Ariel Gorelik as SVP and Chief Information Officer

By: Jeff Hatch

August 23, 2017

AmTrust Financial Services, Inc. Strengthens Senior Management Team with Appointment of Ariel Gorelik as SVP and Chief Information Officer
 
AmTrust veteran Christopher Longo continues as Chief Operating Officer
 
NEW YORK, Aug. 16, 2017 (GLOBE NEWSWIRE) -- AmTrust Financial Services, Inc. (Nasdaq:AFSI) (the "Company" or "AmTrust") today announced that Ariel Gorelik, an experienced  global insurance industry executive and most recently Chief Operating Officer of AmTrust's AMT Warranty division, has been appointed Senior Vice President and Chief Information Officer (CIO), reporting to Chairman and Chief Executive Officer Barry Zyskind. Mr. Gorelik succeeds Christopher Longo who continues as EVP and Chief Operating Officer, appointed in 2016, who has guided technology development at AmTrust as the Company's CIO since 2006.
 
Mr. Gorelik will lead AmTrust's global IT organization, with a focus on operational excellence across the IT function. He is responsible for ensuring that AmTrust will continue to lead through technology innovation and capitalizing on technology solutions to help enable AmTrust fulfill its business goals. Mr. Gorelik's extensive operational leadership experience in the insurance sector includes expertise in centralization of operations and transformation of service delivery to improve customer satisfaction.
 
Mr. Gorelik joined AmTrust in 2014 as Senior Vice President AmTrust North America operations, and in January 2016 was promoted to Chief Operating Officer of AMT Warranty, one of the Company's operating subsidiaries in the U.S. Prior to joining AmTrust, from 2013 to 2014, Mr. Gorelik was a managing consultant of the ICON division for Zurich North America, a property and casualty insurer. From 2010 to 2013, he served as deputy chief operating officer at SK Allianz/Allianz Group, a German property and casualty insurer. He was responsible for the procurement, real estate management, and transportation departments, as well as for areas of IT relating to Allianz's core insurance system. He also led the organization's full automation of the policy life cycle. Prior to his role as deputy COO, Mr. Gorelik served as head of Allianz Eurasia's business services, where he established a shared service center with a number of back and middle office functions, including claims handling, P&C policy administration, payments, and call center.
 
"AmTrust has always led with technology and innovation, which have been a competitive differentiator for us," said Barry Zyskind, Chairman and Chief Executive Officer. "Under Ariel Gorelik's leadership as Chief Information Officer, we will continue to harness the power of our technology platforms and digital capabilities. Similarly, we now can maximize Chris Longo's management focus as AmTrust's Chief Operating Officer to enable us to undertake the initiatives and processes to optimize results across our business units and product and service offerings."
 
Mr. Zyskind continued, "With more than 400 knowledge developers within our IT staff of 1,000 men and women supported by in-house underwriting, actuarial and claims processing experience, innovation is in our DNA. Chris has been instrumental in developing our technology platforms and building our IT organization into the powerhouse it is today. He led the development of a single proprietary platform that allows us to continually improve the experience of our agents and our customers. It also allows us to develop new products and integrate emerging technologies quickly. With our IT function well established, Ariel, as Chief Information Officer, can move us further forward, utilizing his abilities to increase efficiencies across broad organizations and platforms, while enhancing the experience of our brokers, agents, and policyholders."

For more information, please contact:
 
AmTrust Financial Services, Inc.
Chaya Cooperberg
Chief Communications Officer & SVP Corporate Affairs
chaya.cooperberg@amtrustgroup.com
646.458.3332

Filed Under: AmTrust, Ariel, Financial, Gorelik

AmTrust Reports Second Quarter 2017 Net Income And Confidence In Long-Term Financial Strength

By: Jeff Hatch

August 09, 2017

AmTrust Financial Services, Inc. (Nasdaq:AFSI) today announced second quarter 2017 net income attributable to common stockholders of $5.8 million, or $0.03 per diluted share, compared to $127.2 million, or $0.73 per diluted share in the second quarter 2016. For the second quarter 2017, operating earnings were $72.9 million, or $0.40 per diluted share, compared to $135.3 million, or $0.77 per diluted share, in the second quarter 2016.
 
Net income and operating earnings in the current quarter were impacted by catastrophe losses of $16.1 million after-tax, or $0.09 per diluted share, ($24.8 million pre-tax).
 
"We took transformative steps in the second quarter, executing on a number of strategic initiatives to increase certainty and confidence in AmTrust's long-term financial strength, and appointing a new CFO," said Barry Zyskind, Chairman and Chief Executive Officer, AmTrust. "In particular, we enhanced our balance sheet and capital base through a $300 million equity investment by members of the Karfunkel family to further support our insurance business and organic growth opportunities. Our sale of approximately 86% of our equity position in National General simplifies our balance sheet and reduces concentration in our investment portfolio composition. The reinsurance agreement we entered provides up to $400 million of coverage for adverse net loss reserve development, in excess of our stated net loss reserves as of March 31, 2017, to insulate AmTrust from future reserve volatility. We undertook these actions with a long-term view for the Company and our shareholders, to demonstrate strength and stability to all of our partners, brokers, agents, and insureds, and to enhance our earnings consistency."
 
Mr. Zyskind continued, "Our second quarter financial results reflect disciplined sales execution and high policy retention levels with gross written premium of $2.2 billion, up 6.1%. We are focused on maintaining underwriting and pricing rigor in our target markets, and are taking a conservative stance toward our book of business in order to support future profitability and balance sheet strength."
 
Second Quarter 2017 Results
 
Total revenue was $1.6 billion, an increase of $0.2 billion, or 18.2%, from $1.4 billion in the second quarter 2016. Gross written premium was $2.2 billion, an increase of $0.1 billion, or 6.1%, from $2.1 billion in the second quarter 2016. Net written premium was $1.4 billion, an increase of $0.1 billion, or 8.2%, compared to $1.3 billion in the second quarter 2016. Net earned premium was $1.4 billion, an increase of $0.2 billion, or 16.8%, from $1.2 billion in the second quarter 2016. The combined ratio was 101.2%, compared to 91.3% in second quarter 2016, and the adjusted combined ratio was 95.9%, after giving effect to the adverse development cover.
 
Year-to-Date 2017 Results
 
Total revenue was $3.1 billion, an increase of $0.4 billion, or 16.0%, from $2.6 billion YTD 2016. Gross written premium was $4.5 billion, an increase of $459.8 million, or 11.5%, from $4.0 billion YTD 2016. Net written premium was $2.7 billion, an increase of $0.2 billion, or 9.1%, compared to $2.5 billion YTD 2016. Net earned premium was $2.6 billion, an increase of $347.2 million, or 15.4%, from $2.3 billion YTD 2016. The combined ratio was 98.6% compared to 91.6% YTD 2016. The adjusted combined ratio was 95.8% compared to 91.6% YTD 2016.
 
A summary of Q2 results is listed below along with a link to the earnings release. 
 
Financial Highlights
 
Second Quarter 2017 Highlights
 
Second quarter gross written premium of $2.2 billion and net earned premium of $1.4 billion, up 6.1% and 16.8%, respectively, from the second quarter 2016
Second quarter service and fee income of $168.4 million, up 35.5% from the second quarter of 2016
Second quarter net income attributable to common stockholders of $5.8 million, or $0.03 per diluted share, compared to $127.2 million, or $0.73 per diluted share, in the second quarter 2016
Second quarter operating earnings of $72.9 million, or $0.40 per diluted share, compared to $135.3 million, or $0.77 per diluted share, in the second quarter 2016
Second quarter gain of $68.4 million on sale of 10.6 million shares of National General stock
Second quarter loss ratio of 74.2% compared with 66.4% in the second quarter of 2016
Second quarter loss ratio of 68.9% after giving effect to the adverse development cover
Second quarter combined ratio of 101.2% compared with 91.3% in the second quarter 2016
Adjusted combined ratio of 95.9%, after giving effect to the adverse development cover, versus 91.3% in the second quarter 2016
Second quarter annualized return on common equity and annualized operating return on common equity of 0.9% and 11.4%, respectively
Board of Directors approves payment of quarterly dividend on common stock of $0.17
 
To view AmTrust Financial Services’ Q2 earnings release, visit the Investor Relations section at http://ir.amtrustfinancial.com/index.cfm or click on the following link: http://ir.amtrustfinancial.com/releasedetail.cfm?ReleaseID=1036573 

Filed Under: 2017, AmTrust, earnings, financial, Q2, share, Warrantech

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