We've all heard of dealerships getting sued because customers claimed the F&I office sold them products they didn't want.
But have you heard of dealerships being sued for failing to offer a product the customer later needed?
At the F&I Summit in Las Vegas I heard about a Chevrolet dealership that was sued for failing to offer a guaranteed asset protection contract to a customer.
That's right. The customer had an accident not long after buying a new car and got a nasty surprise when the auto insurer's check didn't cover the balance on the loan.
So the customer sued, saying that he wouldn't have been $10,000 in the hole if the dealership had offered him a GAP contract, which covers the negative equity if a vehicle is totaled or stolen.
The dealership went out of business as a result of General Motors' 2009 bankruptcy. But it leaves behind a valuable lesson.
F&I managers need to present all products on the dealership's menu to every customer and to document the customer's decision on each item, whether declined or accepted. Dealerships must protect themselves.