AmTrust Announces Net Income For The Third Quarter 2016

By: Jeff Hatch

November 03, 2016

Warrantech’s parent company, AmTrust today announced third quarter 2016 net income attributable to common stockholders was $103.6 million, or $0.60 per diluted share, compared to $182.7 million, or $1.09 per diluted share, in the third quarter 2015. 

For the third quarter 2016, operating earnings was $126.3 million, or $0.73 per diluted share, compared to $150.9 million, or $0.89 per diluted share, in the third quarter 2015. Annualized return on common equity was 15.9% for the third quarter 2016 compared to 35.4% for the third quarter 2015. Third quarter 2016 annualized operating return on common equity was 19.4% compared to 29.2% in the third quarter 2015.

"We delivered a solid performance in the third quarter, with strong investment results, higher service and fee income, and growth in gross written premiums, compared with the same period a year ago," said Barry Zyskind, Chairman, President and Chief Executive Officer, 
AmTrust. "Our performance reflects a full quarter's contribution from Republic Companies, as well as continued strong policy retention and disciplined underwriting of new business in our small commercial business segment, as demonstrated by our stable loss ratio. The top-line results of our specialty risk and extended warranty segment reflect the impact of the decline in the British pound relative to the third quarter a year ago, and we are pleased with the underlying performance of this segment."

Mr. Zyskind also stated, "We are optimistic about our organic growth prospects, given our differentiated model in workers' compensation and commercial lines products in the U.S., as well as opportunities in our warranty insurance offering globally. We remain focused on building a portfolio of business that leverages our proprietary technology and our efficient operating structure to enhance shareholder returns."

Third Quarter 2016 Results

Total revenue was $1.41 billion, an increase of $181.3 million, or 15%, from $1.23 billion in the third quarter 2015. Gross written premium was $2.03 billion, an increase of $253.3 million, or 14%, from $1.78 billion in the third quarter 2015. Net written premium was $1.22 billion, an increase of $73.1 million, or 6%, compared to $1.14 billion in the third quarter 2015. Net earned premium was $1.20 billion, an increase of $150.8 million, or 14%, from $1.05 billion in the third quarter 2015. The combined ratio was 91.5% compared to 92.6% in third quarter 2015.

A summary of Q3 results is listed below along with a link to the earnings release. 

Financial Highlights

Third Quarter 2016

Gross written premium of $2.03 billion, up 14.2% compared to $1.78 billion in the third quarter 2015
Net earned premium of $1.20 billion, up 14.4% from $1.05 billion in the third quarter 2015 
Net income attributable to common stockholders of $103.6 million compared to $182.7 million in the third quarter 2015
Operating earnings of $126.3 million compared to $150.9 million in the third quarter 2015
Diluted EPS of $0.60 compared to $1.09 in the third quarter 2015
Operating diluted EPS of $0.73 compared to $0.89 in the third quarter 2015
Service and fee income of $146.6 million, up 16% from $126.1 million in the third quarter 2015
Combined ratio of 91.5% compared to 92.6% in the third quarter 2015
Weighted average diluted shares outstanding of 173.1 million, up 3% compared to 168.3 million in the third quarter 2015

Filed Under: earnings, Financial, gross, income, premium, Q3, quarter, third, Warrantech, written

Warrantech Certifies NIADA CPO Program Agents

By: Jeff Hatch

September 14, 2016

Now the agents who administer the NIADA Certified Pre-Owned program are certified themselves. 

Warrantech, the The Amynta Group company that serves as the program’s administrator, held the first NIADA CPO program agent certification training program in July at the company’s headquarters in Bedford, Texas.

More than 40 agents attended the session, which included presentations from many of the program’s corporate partners, such as Carfax, eBay Motors, AutoZone/ALLDATA, SiriusXM and, of course, Warrantech.

NIADA senior vice president of dealer services Scott Lilja was also on hand to provide an overview of the association, its membership value proposition and key industry trends.

The objective of the session was to help Warrantech agents become fully versed in the NIADA CPO program, from initial sales presentation to kickoff implementation, including sales and marketing best practices, core mechanics of the program and the cultural mindset needed in the dealership to maintain consistency for ongoing success.

All of the agents passed the final exam to earn their certification and left ready to assist independent dealers in implementing the NIADA CPO program. 

This article originally appeared in the September 2016 edition of Used Car Dealer magazine and can be found online at: http://www.usedcardealermagazine.com/i/720198-sep-2016/8

Filed Under: Certified, CPO, NIADA, Pre-Owned, Vehicles, Warrantech

What Is The Difference Between A Warranty And An Extended Service Plan?

By: Jeff Hatch

September 07, 2016

This is one of the most frequently asked questions we receive and one that causes a lot of confusion among customers. Simply put, a warranty is an agreement to make any repairs or replace defective parts during a specified period of time upon purchase – a 90-day warranty, for example. It is provided by the manufacturer or dealer and included in the purchase price of a product. By contrast, a service contract/plan is a separate agreement designed to provide protection after the manufacturer’s warranty expires.  
 
Since a manufacturer’s warranty is only good for a limited time, having additional coverage for important purchases makes a lot of sense. An extended service plan (or vehicle service contract) is a popular choice among customers who want extended coverage on everything from consumer electronics, automobiles, home appliances, boats, power tools and other items they truly value or see as an important long-term investment. For instance, a cash-strapped college student who can’t afford to be without a laptop computer for schoolwork would be smart to invest in a service plan. 
 
A service contract also offers additional benefits that generally aren’t covered under the terms of the manufacturer’s warranty. If you bought a new vehicle, chances are your warranty only covers defects and issues that came about during the design and manufacturing process. With a service contract, you can get supplemental coverage for important systems like the transmission and suspension, and ancillary product protection that covers paint, dent, fabric and windshield repair. 
 
In addition to product and purchase protection, service contracts offer consumers convenience and peace of mind. There have been several articles as of late that all list this as one of the main reasons that people feel that a service contract is well worth the added expense. Should something go wrong with your purchase, you’ll receive immediate assistance. Plus, a service contract can be purchased for just a fraction of what you would normally pay for service repair or, in worst-case scenarios, an entirely new item. 
 
If you do decide that you are interested in extended protection, the best rule of thumb is to always make sure that you carefully compare the service contract with the manufacturer's warranty. Also, consider: 1) the cost of the service contract, 2) the types of coverage it offers, 3) the length of time covered, and 4) how you expect to use your purchase. And if you have any concerns regarding your service agreement or need help with a specific type of coverage, feel free to reach out to us. We’ll be more than happy to help.
 
Visit our website to view more frequently asked questions from our consumers. Or call us at 800.833.8801.

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

New Program Offers Certified Pre-Owned Cars With A Warranty

By: Jeff Hatch

August 11, 2016

The following story and broadcast appeared on WSPA 7 News, a CBS affiliate in South Carolina. To view the video or read the original article, visit: http://wspa.com/2016/08/11/a-brake-for-used-car-buyers-new-program-offers-certified-per-owned-cars-with-a-warranty/ 

We get a lot of calls from viewers who bought a used car, “as is,” only to have it break down shortly after. When dealers won’t fix it, drivers are out of luck.

Now a new certified pre-owned program that’s spreading across the country has made it to the Upstate. There’s only one local dealership in that program so far because it’s so stringent. So we looked into the benefit for consumers, and whether there is a cost involved.

“Our program bases a lot on statistics. We know that if you do 125-point inspection on a car, the odds of it breaking down go down to minuscule,” said William Carr with The Amynta Group/Warrantech.

The warranty backers have teamed up with the National Independent Automobile Dealers Association to support the certification program.

In addition to that thorough inspection, each vehicle will also get a Carfax report, recall check and come with a warranty of at least 3 months/3,000 miles, or 10yr/100k powertrain.

“By giving the consumer a better product, in the long run we’ll sell more cars. So I think it’s a win win,” said Darla Booher, the owner of Deal Depot in Greer, Spartanburg and Duncan.

Her dealerships are the only active members right now. And as such, those lots will have to abide by a strict code of conduct.

“There is a very stringent standard that deals not just with the inspections but with the entire running of a car lot. Recently an upstate dealer had to exit the program because they couldn’t live up to the standards of the program,” said Carr.

There are about 80 dealerships across the country involved in this program, with about 5 new ones added each week. In fact one in Greenville is coming on board before the end of the summer.

Administrators say the program cost for inspections and the warranty are minimal. But of course it begged the question, is that passed along to consumers?

“No, there’s absolutely not additional cost to the consumer,” said Booher.

In fact, when it comes to the warranty, it’s illegal for a dealer to charge for that or it becomes a service contract.

One word of caution, as a consumer you want to make sure that there’s no bait and switch. If a car is advertised as certified, the dealers should not offer to take off the certification for a lower price. That’s illegal.

The NIADA Certified program performs quarterly inspections to make sure all dealers are continuously compliant.

Filed Under: automobile, Carfax, CBS, certified, CPO, dealer, NIADA, pre-owned, program, Warrantech, WSPA

Warrantech Announces New Service Network Updates

By: Jeff Hatch

August 05, 2016

Warrantech is proud to announce that we have made several updates to our service network, starting with a new field service network management team. Effective immediately, David Velasquez will provide enhanced partnering and direct support as the West Regional Manager, along with Brian Schlepp, Central Regional Manager, and Brian Weaver, East Regional Manager. 
 
We are also excited about the implementation of software solutions from ServicePower, who will provide mobile workforce management tools to drive efficiency and streamline how Warrantech dispatches service centers and schedules appointments with customers. 
 
“One of the many benefits of ServicePower is the transparency it provides our customer service staff with our field, enabling us to provide real-time updates on the status of repairs,” said Ricardo Pina, Warrantech Customer Service Manager. “I am confident that ServicePower will greatly reduce service turnaround times and minimize escalations and complaints.”
 
ServicePower, which goes live on August 10, will allow customers to pick calendar dates and times, and automatically dispatch service. The program will also report when a service order has not been completed within three days, at which point a servicer will get an alert and the customer will be given an update as well.
 
Additional support functions being implemented to provide enhanced customer/servicer follow-up include: 
 
Enrollment available for direct deposit (ACH) for payment of repairs and replacement. 
Completed claims will be processed for payment within 7 business days. 
Warrantech will cover trip/service calls for non-validated repairs (i.e., No Problem Found). 
Implementation of a Parts Order guarantee: Parts Orders through Warrantech’s parts portal are guaranteed for 90 days. In the event the part fails within 90 days, Warrantech will pay servicer for second service call. 
The current market environment dictates the ability to promote increased repair opportunities; we may, as required, opt to use a non-OEM part(s) to complete the service event. 
Improved call center staffing and training to promote a world-class experience. 
Upcoming implementation of the following ServicePower solutions: ServiceDispatch, ServiceStats and ServiceOutsourcing 
 
Warrantech is always seeking ways to improve our business model so that customers and service providers are made a priority and given preferential treatment. We are confident that these new positive changes do just that and will continue to help build stronger partnerships and continued growth.
 
To learn more about Warrantech’s unparalleled service excellence, visit warrantech.com

Filed Under: customer, service, ServicePower, solutions, transparency, Warrantech

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