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.