Training in claims pays off in happy customers

When service advisers don't know how to file claims on service contracts and other finance and insurance products, customers often become frustrated and lose faith in F&I products and the dealership.

Service advisers file claims on automakers' products "on auto pilot," but "if they have to call an unfamiliar 800 number and file a claim, it's mission impossible," said Max Zanan, automotive retail consultant.

"Oftentimes, we hear them say, 'We don't accept this product,' which is completely ridiculous," Zanan said. "Ninety-nine percent of [F&I companies] reimburse the service department for labor, and 99 percent of them pay [manufacturer's suggested retail price] for parts. Even if [the customers] didn't buy it from the dealership, either service is short staffed or they have zero desire to go the extra mile and satisfy the customer."

Most F&I product companies train the dealerships' service departments on filing claims, avoiding much of that frustration, experts said.

"That way they're well-versed in what the product does as well as how easy the claims process is," said Greg Kostern, business operations director for Johnson Automotive in Raleigh, N.C. "The easier and more efficient the claims process is for the guests, the better the service retention, the better the retention is for the dealership in general."

He added: "The No. 1 reason consumers decided not to purchase extended coverages typically is because of poor experiences, whether it's with claims or a situation where they feel like it was misrepresented. We try to eliminate that risk."

Johnson Automotive began claim submissions training about five years ago, Kostern said. At times, when customers with F&I product coverage came in for service, service advisers said they couldn't get the claim paid. "They were actually turning it back on the customer, saying, 'You need to file this. You need to send in the proper documentation. You need to take pictures,' instead of handling it internally and making the process seamless for the guest."

There was pushback to the claims training at first, but the service advisers soon saw the benefits, he said. "When those types of complaints were cut down significantly, the process was bought in and they felt good about it," he said.

Most F&I product providers have clear training procedures to keep service advisers informed.

The Warranty Group, for example, has a "very specific" installation process, said Ash Bauer, executive vice president of Warranty Group's Resource Automotive division in Chicago.

"Once the dealer [commits to working with us], we understand that the service contract will affect everyone in the dealership," he said.

The Warranty Group trains the service department on what each product covers and the products that their F&I department predominantly sells. The company also ensures that when the service adviser enters a customer's vehicle identification number, he or she will immediately have access to F&I product information.

United Development Systems in Clearwater, Fla., walks the service advisers through the entire claims submissions process and introduces them to the person they will talk with when they file those claims.

"That usually gets the process off to a much better start," said John Tabar, trainer for United Development Systems.

"We want to connect people, get the relationship started."