(Mis)sell­ing in­sur­ance

Car Mechanics (UK) - - Project Mercedes-benz E320 Cdi -

When I started sell­ing car fi­nance and as­so­ci­ated in­sur­ance prod­ucts, there was pre­cious lit­tle reg­u­la­tion and no manda­tory train­ing. What of­fi­cial train­ing you did get was, to be hon­est, there to help you max­imise mar­gins.

Over the past few years, the fi­nance in­dus­try has taken a kick­ing over mis­selling in­sur­ance prod­ucts such as en­dow­ment mort­gages and PPI. In re­sponse, they’ve made sell­ing more reg­u­la­tory. From the busi­ness to the in­di­vid­ual sales­per­son, ev­ery­thing is vet­ted, in­ves­ti­gated, trained and thor­oughly tested. It makes money for many be­fore a sale is even closed, but does it work?

Of course, it doesn’t. It’s ad­min for the sake of arse-cov­er­ing. There are garages out there who sim­ply shouldn’t have a credit li­cence.

I’d like to think you’d be wise enough to avoid such places. But what if you’ve just spent £50,000 or­der­ing a brand-new Ger­man wun­der­wa­gen from a PLC deal­er­ship? Surely the F&I prod­ucts of­fered there would be cor­rectly sold? No.

I’ve en­coun­tered al­loy wheel in­sur­ance be­ing sold at the point of sale/or­der­ing of a new car which tran­spired to be not fit for pur­pose. This in­volved a car that came with stan­dard-fit di­a­mond-cut al­loys. The sales­per­son duly ex­tolled the virtues of their al­loy wheel in­sur­ance pack­age, which was duly bought. Ex­cept when a claim was made for a kerbed al­loy, the in­sur­ance prod­uct turned out to be worth­less. Specif­i­cally, in the very small print, di­a­mond-cut al­loys were ex­cluded. The pre­vi­ously very chatty sales­per­son sud­denly clammed up.

Did the dealer want to know about its sales­per­son’s mis-sale? No. Did the dealer group? No? Did the Ger­man man­u­fac­turer? No. Did the Fi­nan­cial Ser­vices Au­thor­ity? No. The com­plaint was brushed un­der the car­pet and, af­ter nine months, only a ‘ges­ture of good­will’ was forth­com­ing as con­so­la­tion for try­ing to ex­tract jus­tice. All those of­fi­cial cer­tifi­cates as­sur­ing you of hon­esty and in­tegrity are still, post-bank­ing cri­sis, not worth the em­bossed pa­per they’re writ­ten on.

When it comes to in­sur­ance poli­cies, never ig­nore your gut feel­ing. Au­tho­rised does not equal pro­fes­sional.

Di­a­mond-cut al­loys weren’t in­cluded in the in­sur­ance pack­age.

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