While vehicle service contracts offer valuable peace of mind to consumers and an additional profit center for dealers, fulfilling those contracts requires a long-term financial commitment and a substantial investment in people and systems. With so many service contract providers in the marketplace, we looked at what it takes to truly excel in this business.
When VSC providers process claims, they are actually serving two customers: the consumer and the service department. The first requirement is to quickly take claim information—either directly from the vehicle owner or a service technician—and resolve the claim accurately and promptly. The second requirement is to reimburse the service department, where speed and accuracy are again paramount. How well the promises made during initial sale of the contract are met is what separates providers into the good, the bad and the excellent.
CNA National: Setting the Standard on Claims Service Performance
To excel in this arena requires both a technologically advanced claims management system and claims adjusters who know what to do with the information. CNA National Warranty Corporation has long set the standard on claim service performance, as reflected in its being voted a #1 provider 16 years* in a row in the Dealers’ Choice Awards.
Claims calls to CNA National are answered within seconds by one of over 60 ASE-certified technicians holding 360 certifications.
Performance at this level is no accident. To hear CNAN executives tell it, their ability to handle their business is achieved through equal parts people and philosophy. "We fulfill the promises made to the consumer at the point of sale," says Alan Miller, CNAN's senior vice president of sales. "F&I sells a promise. If you maintain your vehicle according to the manufacturer’s guidelines, we'll fix all covered repairs. We know that a customer’s experience with us has a direct effect on dealers’ reputations and CSI scores. By providing outstanding customer service, we can help build the trust and value that will keep your customers coming back."
In order to answer calls so quickly, and to pay those claims, CNAN has assembled a unique claims center staff that uses a robust information management system tailored to meet their specific needs. The system not only efficiently routes calls to the adjusters to meet the response time goal, it provides all of the vehicle and contract information at once and gives CNAN’s management the data needed to properly staff the claims center. Even the best system would fail without the people to service the customers.
Rather than just hire people with good phone skills, CNAN employs former automobile service professionals, according to Joe Becker, president and chief executive officer. Becker says CNAN prefers to hire people who have worked in the service department themselves and who understand both automotive technology and the pressures of getting customers’ vehicles fixed in a timely, and profitable, manner for the dealership.
“Good communication skills are paramount,” Becker says. "People who were service advisors had to be 'people people’ to do their jobs well. The second thing it gives us is empathy," he continues. "There's a kinship, a connection that sells very well across the phone and builds relationships."
The third benefit of the staffers' years of experience is how it helps the person on the other end of the phone: service advisors who are in the process of filing a claim to get a vehicle repaired. "The fact that our adjusters know how vehicles are repaired limits the amount of time it takes to process a claim. Time is money to service advisors; they want to write service," Becker explains.
Miller, a 25-year industry veteran, is also clear on the value of service contracts to automobile dealerships themselves. Not only does CNAN pay claims promptly to dealers—averaging two calendar days with same-day payment available by credit card—the customer satisfaction factor is invaluable.
As he says, "Because of the way our claims center takes care of our customers, you're going to have happy customers, as well as fewer customer complaints about what you sold them."
With service contract providers competing fiercely for the business of auto dealers, many companies emphasize the upfront profitability and financial rewards to win the business, but your customers at the dealership and service department are best served with a company that can also deliver superior service and financial performance over the long-term.
*Best Service Contract Provider 2005-2010, 2012-2020; Best Reinsurance Provider 2011-2013, 2017, 2020
