Loading...

Hi again.  If you read the first two installments then great!  If not, we have been talking about different services that car dealerships should offer in an effort to provide a better and more thorough customer service. 

In the first one we talked about financing and in the second one we covered a few different types of service contracts.  Today, we will talk about the third type of service contract and a few other things. 

Are you ready?

GAP Insurance

This is a type of service contract and generally it is purchased trough car insurance companies, however a few dealerships do offer this.

This type of insurance is basically protection that is for the loan in case the vehicle is stolen or declared a total loss in an accident.  In the event of one of these two incidents, the remaining loan payments are paid by the insurance company so that the consumer is not stuck paying for a vehicle that is no longer in their possession. 

In many states, this type of insurance is regulated. 

Now that we have covered all of that, there are still other things that can be offered by dealerships to garner customer loyalty, trust and repeat business as well as referrals.  

This next one is a type of insurance, but not a service contract like the ones previously discussed.

Credit/Disability/Life Insurance

This is a type of insurance that can be a pure profit center for the dealership.  It cannot however, be a condition required of the loan. 

Consumers many time are given the option to purchase this type of insurance that will cover their loan in the event that the consumer becomes unable to repay it due to a life event such as a job loss due to disability or other incident that is no fault of theirs. 

Generally, this type of coverage will go into action on the 31st day of the disability.  In other words, the consumer must be unable to work at least 30 days before making a claim.  Additionally, there is generally much paperwork that has to be submitted in order to validate the claim. 

In the event that the consumer dies before the loan is paid, this type of insurance will pay the rest of the loan. 

While this is a service that consumers can obtain from their private insurance companies, there are times when consumers would prefer to deal with the dealerships or finance company itself and cut out the middle man entirely. 

Well, that about covers it for this stage of these articles. 

When dealerships offer these types of services and contracts to the it customers, it means that while the customer has to keep making the payments, they will also know who to turn to in case of anything happening. 

It makes it easier for them when there is only one place to deal with instead of trying to get answers and go back and forth between multiple businesses.  It shows the buyers that the dealership is willing to go the distance for them.  
 

Read Part 4