Dos and Don’ts — A Warrantech Customer’s Perspective

By: Jeff Hatch

January 15, 2016

The following advice comes from a Warrantech customer who purchased an extended service plan for a tablet. All claims are handled differently – depending on product, problem and usage – but hopefully this provides you with some insight as to what to expect and how you can be prepared in the event that you need to file a claim.

I had to use this extended service plan on a previous tablet I bought – all went smooth. After it broke I made a claim, got a prepaid label, mailed the broken one in, and they sent me a check in the mail to cover what I paid for it. I've bought it again for another tablet I got my daughter. Hopefully this one won't break, but you never know with kids.

Had to use them again [for another electronic device], same as above – no complaints, way cheaper than buying insurance from your phone carrier.

Couple words of advice as to why some may run into issues:

1) Make sure you buy this extended service plan within 90 days of your tablet purchase.
2) Hold on to the receipt and original packaging (if it was bought online it’s much easier to do).
3) Register your extended service plan as soon as possible.

I've always done this with these items, so when it came time for a claim it's a matter of answering a few questions and then you get your shipping label and send it off. I've yet to have them actually repair/replace a $0-200 price range tablet; they have always sent me the replacement cost in a check.

Last comment – be sure to read what you are purchasing. Some plans are only extended warranties, some include accidental protection. Also, be sure to buy the right policy to match your tablet’s retail value. Don't buy a $0-200 plan if you have a $500 tablet.

To learn more about what our customers have to say about us and our extended service plans, visit warrantech.com

 
And if you have a similar story or advice to offer our customers, be sure to share it with us here.

Filed Under: advice, customer, extended, plan, service, tablets, warrantech

When Is An Extended Service Plan Worth The Investment?

By: Jeff Hatch

December 09, 2015

You did it. You finally worked up the gumption to buy the one product you’ve debated purchasing for months. Whether it is a brand new car, technologically advanced appliance or the latest electronic gadget, you’ve made it through second guesses, financial calculations and a lengthy checkout line to finally make your purchase. Relieved and excited, you smile as the sales associate rings up your coveted item. 

As you daydream about how wonderful life will be with your new “toy,” you realize the sales associate asked you a question. You beg their pardon.

“I asked what sort of protection plan you’d like. We have a number of extended warranty options,” the associate replies.

Your smile fades. Apparently the decision making isn’t quite over after all.

*****

Does this sound familiar? For many people, the question of whether or not to purchase an extended warranty (more appropriately referred to as an extended service plan, or ESP)* is a tough one, and may not be a decision they are prepared to make. When is such a purchase advisable? Will it save money, or just add cost to a purchase? The answers to these questions depend upon a number of factors specific to each purchase. Consider the following before you reach the point-of-sale in the future, and you may save time and avoid stress:

*NOTE: While many store associates and consumers consider the purchase to be an extended warranty, this is often not the case. Many extended plans are not truly adding on to the original manufacturer’s warranty, but rather, extend the post-warranty service options and are therefore more appropriately referred to as an extended service plan, or ESP.

What is the product and who produced it?

Reputation is always an important consideration when attempting to predict the longevity of a product. Some types of items are statistically more likely than others to need repairs in their first few years of use. According to Consumer Reports, for example, computers, self-powered lawn mowers and certain refrigerator designs top the list of items most likely to fail. 

It is important, also, to consider whether the product you’re buying incorporates cutting-edge technology or is a first-generation product. With less of these products existing in the marketplace, there is a higher likelihood of glitches or problems that may not have been discovered during testing. Also, factor in what company created the product you are purchasing. Do they have a history of releasing products before the “bugs” have been worked out?

How much does the product cost and how tough would it be to replace?

If purchasing an expensive item, it is important to consider how much repairs or replacement would cost versus the cost of an ESP. If the item is of critical importance to you, such as a computer used to make a living, an expensive part failure could be very detrimental. 

“For many people, peace of mind is the greatest benefit of an extended service plan,” according to Sean Stapleton, CEO of Warrantech. “They want to know that if their product should cease to function correctly, they will be covered, especially if replacement would be difficult to finance.”

Who is this product for and how will they handle it?

It is important to consider who will be using the product you’re purchasing, the environment in which it will reside, and the frequency it will be used. Are you buying a product for a young person? Is the item for use while on-the-go? Will you use the product routinely? If the answer to any of these questions is “yes,” you may want the confidence and protection that the product will last. Knowing your end user and end-use environment is important when deciding whether to invest in an extended service plan. Always review plan information carefully, ensuring you know exactly what is and isn’t covered.

The next time you make a significant investment in a product, ask yourself these three questions and be prepared once you get to the point-of-purchase.

Filed Under: cost, extended, plan, product, purchase, replace, service, Warrantech

Top 10 Ways To Improve ESP Attachment Rates On The Retail Floor

By: Jeff Hatch

November 23, 2015

In the world of extended service plans (ESPs), extended warranties, or service and parts replacement programs, many consumers have become immune to the common tactics used to sell these programs. In fact, if your sales team is still selling the “what if” scenario to today’s ultra educated consumers, your store is losing out on valuable sales that help drive high-margin growth and revenue.
 
According to NBC News, extended warranties help fuel a booming $15 billion-a-year business; therefore, it’s imperative that retail sales personnel hone their sales approaches for “add on” sales such as ESPs. Through ongoing training and education, sales teams are better able to overcome “new” objections to these profitable plans and figure out which plan best suits the consumer’s need.
 
The below selling strategies are simple, but effective ways to help your sales team illustrate the value of ESPs and therefore convert more consumers:

  1. Get consumers’ attention — By stating the obvious such as, “This product is covered under the manufacturer’s warranty for only one year,” you may pique the consumer’s interest enough to have him/her asking more about warranty coverage.
  2. Listen to consumers’ answers — It seems simple, but often sales representatives get so busy pushing sales out the door, they don’t hear what consumers really want to know more about. If a representative addresses some of the comments consumers share during the sales process, then consumers may be more inclined to listen to sales talk about protection plans. Remember, always address consumers’ objections and point out how ESPs overcome the objection.
  3. Give options — Often consumers may be more inclined to purchase extended coverage if they know they have options. This puts them in the driver’s seat to select the coverage that best suits their needs. For example, offer extended or standard warranty coverage and let them ask questions about the difference, which will lead to the sale of a plan that they believe in.
  4. Stay positive — Much like in life, if you focus on the positives, you’ll more likely receive favorable feedback. Focusing on the strong features and benefits of the ESP, consumers may find the up front fee is well worth the investment.
  5. Expert source — Provide consumers with sales representatives’ credentials or the training they receive prior to selling on the floor. (This is most effective if the store posts signs on the floor about the quality of its staff.) In doing so, when a sales member states, “In my experience, ESPs are essential,” the consumer has a frame of reference for why this is a quantifiable statement. Testimonials are another great way to communicate value and benefits (leverage your personal experiences, your customer, your store’s customer, etc.).
  6. Brands that matter — We’ve all fallen victim to the brand game at one point in our lives and consumers are no different. Consumers generally buy the brands they think represent quality or status and frown upon unknown brands. But while some brands make a great washing machine, they may not make a great TV and it shows in the manufacturer warranty details (especially parts and labor). Your staff needs to know the details of the manufacturer warranties just as well as the ESP to help drive home the value extended coverage offers.
  7. Explain the fine print — Helping consumers better understand what’s covered, what’s not and why makes your sales staff their ally. This type of dialogue not only builds trust, but also gives sales staff an opportunity to reveal some of the holes in the manufacturer’s warranty. 
  8. Think about it — Once consumers have all the facts about the warranties or ESPs, it’s okay to let them think about their options. Have them walk around the store, talk to their spouse/significant other or speak with customer service representatives about the items they see coming back or how much it costs to repair various products. Often, a different source can be a welcomed change of pace for consumers who don’t want to fall victim to “sales hype.”
  9. Recommend it — If you believe in it, your customers will too. Familiarize yourself with the features and benefits and remind customers how costly repairs or replacements can be if they’re not backed by an ESP.  
  10. Ask “why not” an ESP — Sometimes the most obvious questions go unasked such as “Why wouldn’t you want to protect your purchase?” or, “What’s holding you back?” Once your sales staff knows the answer to why, they may be able to employ any number of sales tactics to sell or attach an ESP. 

ESPs add significantly to a retail organization’s bottom line because they don’t require inventory space or carrying costs and they offer high margins. Many consumers are receptive to buying ESPs, but they do need to be convinced to add a plan to their basket and are looking to your sales staff to communicate the features and benefits of the plans, as well as your organization’s commitment behind the plans. Sharpening your sales strategies — on and off the sales floor — is a critical step to increasing ESP sales and enhancing the value these plans bring to consumers.

Filed Under: benefits, extended, plans, retail, sales, service, value

AmTrust Announces An Increase In Operated Earnings For The Third Quarter 2015

By: Jeff Hatch

November 03, 2015

AmTrust today announced continued growth of operating earnings and strong operating return on equity for the third quarter ended September 30, 2015.
 
For the third quarter of 2015, operating earnings were $150.9 million, or $1.79 per diluted share, an increase of 11%, compared to $135.4 million, or $1.70 per diluted share, in the third quarter of 2014. Third quarter 2015 net income attributable to common stockholders was $182.7 million, or $2.17 per diluted share, compared to $156.6 million, or $1.97 per diluted share, in the third quarter 2014. In the third quarter 2015, changes in currencies resulted in a non-cash $24.7 million, or $0.29 per diluted share, increase in net income. Third quarter 2015 annualized operating return on common equity was 29.2% compared to 34.2% in the third quarter 2014. Annualized return on common equity was 35.4% for the third quarter of 2015 compared to 39.5% for the third quarter of 2014.
 
Third Quarter 2015 Results
 
Total revenue was $1.23 billion, an increase of $0.16 billion, or 15%, from $1.07 billion in the third quarter 2014. Gross written premium was $1.78 billion, an increase of $0.26 billion, or 17%, from $1.52 billion in the third quarter of 2014. Third quarter 2015 gross written premium was negatively impacted by $29.4 million due to declines in European currencies. Net written premium was $1.14 billion, an increase of $138.8 million, or 13.8%, compared to $1.0 billion in the third quarter 2014. Net earned premium was $1.05 billion, an increase of $131.0 million, or 14%, from $914.4 million in the third quarter 2014. The combined ratio was 92.6% compared to 91.3% in third quarter 2014.
 
A summary of Q3 results is listed below along with a link to the earnings release. 
 
Financial Highlights
 
Third Quarter 2015
 
Gross written premium of $1.78 billion, up 17% compared to $1.52 billion in the third quarter of 2014
Net earned premium of $1.05 billion, up 14% from $914.4 million in the third quarter 2014
Operating diluted EPS of $1.79 compared to $1.70 in the third quarter 2014
Diluted EPS of $2.17 compared with $1.97 in the third quarter 2014
Annualized operating return on common equity of 29.2% and annualized return on common equity of 35.4%
Service and fee income of $126.1 million, up 7% from the third quarter 2014
Operating earnings of $150.9 million, up 11% compared to $135.4 million in the third quarter 2014
Net income attributable to common stockholders of $182.7 million compared to $156.6 million in the third quarter 2014
Combined ratio of 92.6% compared to 91.3% in the third quarter 2014
 
YTD 2015
 
Gross written premium of $5.19 billion, up 12% compared to $4.63 billion in YTD 2014
Net earned premium of $2.96 billion, up 13% from $2.62 billion in YTD 2014
Operating diluted EPS of $4.80 compared to $4.28 in YTD 2014
Diluted EPS of $4.86 compared with $4.57 in YTD 2014
Annualized operating return on common equity of 27.7% and annualized return on common equity of 28.1%
Service and fee income of $346.8 million, up 13% from $308.1 million in YTD 2014
Operating earnings of $402.8 million, up 19% compared to $339.9 million in YTD 2014
Net income attributable to common stockholders of $408.2 million compared to $362.7 million in YTD 2014
Combined ratio of 90.8% compared to 90.7% in YTD 2014
Book value per common share of $25.81, up 16% from $22.34 at December 31, 2014
AmTrust's stockholders' equity was $2.62 billion as of September 30, 2015, up 29% compared to $2.04 billion as of December 31, 2014

Filed Under: 2015, earnings, income, operated, premium, Q3, quarter, results, third

Top 10 Reasons To Select AmTrust

By: Jeff Hatch

October 19, 2015

Warrantech is a subsidiary of AmTrust, one of the strongest and most financially stable companies in the industry. AmTrust brings this financial strength to Warrantech, which allows us to offer customizable plans and benefits that most competitors simply cannot provide. 
 
1. Financial Strength and Stability – Publicly traded on the NASDAQ (AFSI) with more than $6.1 billion in gross written premium and over $15 billion in assets, with an A.M. Best rating of "A" (Excellent), Financial Size “XIII.”
 
2. Multi-State Capability – Workers’ comp written in over 40 states, and all lines of insurance written in more than 30 states.
 
3. Flexible Payment Plans – Installment plans, AmTrust AutoPay (direct debit) and Pay-As-You-Owe® (PAYO®) provide seamless premium payments, saving time and money.
 
4. Superior Claims Handling – 24/7 claims reporting with live assistance, and seasoned claims professionals with assigned case loads well below the industry average.
 
5. Exceptional Loss Control – Representatives located nationwide to conduct safety inspections, site evaluations and loss prevention training.
 
6. User-Friendly Submission System – Easy-to-use, web-based system provides policy, endorsement and loss history at your fingertips, and allows you to submit and chat online with your underwriter about a submitted risk.
 
7. Competitive LCM Rate Structure – We are continuously evaluating and adjusting our LCMs to reflect our loss experience and competitive environment.
 
8. Competitive Agency Commission – Our commission rates generally range from 9%-20% based upon the product written.
 
9. Expanding P&C Product Offering – We are continuously evaluating the market and our agents’ needs to deliver new coverages from Workers’ Comp to Commercial Package and a wide variety of niche products.
 
10. Satisfying Customer Service – Exceptional service is the mantra at AmTrust, delivered by our field marketing representatives, regional underwriters and centralized customer service professionals.

Filed Under: customer, financial, services, stability, strength, Warrantech

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