RAC Dealer Network partner Assurant says that the importance of value-added product (VAP) affordability is set to increase in 2019.
The demand for extra ‘bang for buck’ via warranties and similar VAPs is going to ramp up in the used sector, and customers will be keen to receive these benefits while not compromising their budget – this according to this according to the motoring warranty firm’s head of account management, Sean Kent.
Kent said: ‘It is well-recognised in the used car market that in times when consumers feel their finances are under pressure, they seek out products that provide them with protection from unexpected costs.
‘As the year progresses, this situation is likely to continue and it is essential that dealers are able to provide warranties and other VAPs that meet customer needs and are within reach for as many used car buyers as possible.
‘The key to enabling these consumers to acquire the level of cover they desire will be very much based around affordability – and we expect to see a greater amount of attention being paid to offering value-added products on an interest-free basis.
‘Delivering the product in this way provides a new degree of flexibility for customers, allowing them to pay on a monthly, budgeted basis.’
Kent also expressed the importance of guaranteed asset protection (GAP) and services plans.
‘Essentially, what many used car buyers will be seeking in 2019 is something very close to fixed-cost, monthly motoring. They don’t want to feel that they could receive a large bill in the event of an unforeseen incident or even just paying for a major service.
‘It is up to dealers and providers of VAPs to create offerings that meet this changing need in a rapidly-moving market.’
Interest-free options for customers on RAC-branded warranties are to be made available across the 1,360-strong RAC Dealer Network via Assurant, giving customers the opportunity to pay for their warranty over 10 months, in equal direct debit instalments.
He said: ‘This is all about supporting our dealers and used car buyers with the right offering for a changing market. When this kind of offer has been made previously, we have certainly found that it has allowed more buyers to access the level of cover that they desire.’