For Immediate Release
Calgary, Alberta, May 21, 2018 – There are significant problems with the perception of the extended warranty business. Obvi Inc. is rebuilding this reputation and is tackling some of the biggest problems facing consumers head-on.
“There are so many problems – from cost to complexity. The Obvi team is passionate about four things: simplicity, transparency, value, and efficiency,” explains Joe McBurney, Obvi President. “We want to make things simple for our customers to understand. Breaking down the most common problems with traditional extended warranties for automobiles is an important place to start.”
1 – Warranties that cost far more than the repairs themselves. “The math is simple: $4,000, $5,000, or $6,000 warranties just don’t make sense for most people. You’re transferring the risk without benefit of the losses of the few paid by the many at this price point” said McBurney.
2 – Terms of coverage often expire before a failure will occur. Most major mechanical breakdowns occur between 120,000 – 160,000 kilometres, a fair policy must cover this time period – many warranty providers offer options that expire too soon thus eliminating any value for the customer.
3 – McBurney noted most policies are not transferable at a dealer trade. Extending the warranty of your vehicle is an investment in future repairs. This should not merely void itself at a dealer trade; which is the most common method for Canadians to offload a vehicle.
4 – Poor coverage has been part of warranty sales games for years. “As a seasoned insurance professional, it is shocking that second, third, and fourth-tier sub-par coverage is still an option,” says McBurney. “Warranties should be easy to understand with coverage and a term that offers the policyholder value.”
5 – “Most of the time overpriced warranties are rolled into finance plans. This tactic not only increases the amount of interest paid by the customer, but it instantly creates a loan-to-equity imbalance,” explains McBurney. Customers are committing to a bi-weekly or monthly incremental increase to their payments and are often unaware of the total cost which can be many thousands of dollars, it adds up fast.
6 – Consumers are not dealing with experts. “You wouldn’t buy house insurance from a realtor or life insurance from a doctor. Obvi provides an unbiased approach to warranties that is not influenced by the sale of the vehicle. Consumers should be dealing directly with the company that will issue the policy and oversee the claim. “Sales and claims handling from different sources can create confusion and frustration,” McBurney said.
“We believe that the solution is obvious: Deal directly with the insurance provider and claims resource, have a quick and simple no-stress purchase experience and get a quality product with pricing that makes sense for the customer. Insurtech has opened the door for significant changes throughout the entire insurance industry” McBurney comments. “We are passionate about providing reliable insurance options to help consumers feel confident and well represented in this space”.