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Compliance Matters October Newsletter, Issue 5

Introduction

Welcome to the Quarter 3 2014 issue of the Car Care Plan Compliance Matters Newsletter, the compliance newsletter produced for motor dealers by one of the top administration providers in the market.

Car Care Plan is committed to providing its dealer partners with timely and accurate information about the compliance matters that could impact them. This newsletter is designed to highlight the compliance hot topics applicable to UK motor dealers.

Whether you are part of a large dealer group or a sole trader this newsletter will provide some useful information about areas of regulatory focus you should be aware of.

FCA add-ons Review update

There has been no formal communication from the FCA with regard to the add-on review for a couple of months now.  The last update we received was when Tim Heavisides (Car Care Plan’s CEO) and some of his management team met with the FCA in August 2014.  During this meeting we had the opportunity to discuss some of our concerns with the FCA’s proposed remedies; both from Car Care Plan’s perspective and also from your perspective.

It’s believed that the FCA has held various stakeholder engagement meetings with dealers and insurers, and it is also believed that they will shortly be moving to the formal workshop stage.  Based on this it’s looking unlikely that the year-end date for the publication of the final Consultation Paper will be achieved.

For Car Care Plan and its business partners, the important thing is that we remain proactive despite the lack of progress. 

Car Care Plan has recently introduced a direct-to-consumer call centre in Manchester, designed to sell warranty, GAP and associated motor products separate to the purchase of the vehicle.  Currently the emphasis through our Manchester operation is on renewal business, but it could equally be used to sell on behalf of dealers, manufacturers or finance providers.  If this initiative may be of interest to you, please contact your usual Car Care Plan Business Development Manager.

We have also been introducing improved management information to highlight the claims ratio calculation – looking at average selling prices of GAP insurance compared against the claims amounts.  We continue to advise you to review your insurance add-on product price regimes to ensure they represent fair value for your customers.

Although we remain hopeful that the FCA’s proposed remedies may change, we are doing everything possible to ensure that we are well placed if any of the planned remedies go ahead.

Consumer Credit Applications

All firms offering Consumer Credit should now have had confirmation of their Interim Permissions from the FCA – if you are unsure about this, please check as soon as possible.  

The FCA has given each firm with Interim Permissions a landing slot to apply to be authorised to provide consumer credit, either with full permissions or limited permissions.  A number of motor dealers are now coming up to their landing slots and will be going through their Consumer Credit Application over the next few months. 

The FCA has published a number of documents, and even a webinar, to help firms understand what is required during the application stage – these can be found via the following link http://www.fca.org.uk/firms/firm-types/consumer-credit

Consumer Focus

In August, Car Care Plan introduced a new Consumer Focus Team.  This team is made up of the Board of Directors and appropriate Senior Management – with the primary goal of: 

  • Continually reviewing overall business performance from a consumer perspective, ensuring that Car Care Plan always puts the customer first.

We plan to achieve this goal by:

  • Having visible customer focussed leadership;
  • Understanding our customers’ needs;
  • Empowering employees to deliver positive customer outcomes;
  • Introducing metrics that matter;
  • Focussing on the consumer outcome alongside financial results;
  • Feedback mechanisms that drive continuous improvement.

One of the key activities the Consumer Focus Team will undertake is reviewing Car Care Plan’s products to ensure they remain market leading – take a look at the case study regarding Car Care Plan’s Asset Protection Products:

Product Governance: The Asset Protection Case-Study

Since 2010 Car Care Plan has made some significant improvements to its Asset Protection products.  These include:

  • Removal of market value adjustments;
  • Introduction of pro-rata refunds;
  • Removal of Financial Shortfall GAP as a stand-alone product;
  • Introduction of flexible durations;
  • Vehicle modifications covered;
  • Simplified claims process;
  • Clearer point of sale material;
  • Defaqto 5 Star Rating.
What have the improvements achieved?

complaints

 

 

  • From 2010 to date there has been a 47% increase in live registrations alongside a 65% reduction in the total number of complaints.
  • During the same period there has been a 15% increase in claims acceptance rates and a 5% increase in the average claim amount.

It is actions like those above that evidences that Car Care Plan continues to put the customer at the heart of its business.  Some firms may introduce new products and never review performance, never change terms and conditions and never review from a consumer perspective.

Once again Car Care Plan shows its proactive approach by continually reviewing product performance, complaints, management information and also by listening to its dealer partners to offer the best products available in the market. 

New Complaints Database & Better Complaints Management Information

Nobody likes to make a mistake, but they do happen – sometimes these mistakes lead to customer complaints.  Car Care Plan has developed a new specialist complaints management system to help identify and log what’s gone wrong – allowing us to deal with complaints both quickly and effectively to avoid repeating the same mistakes again. 

The successful introduction of a new complaints database within Car Care Plan is allowing us to conduct simple and effective complaints reporting and analysis for our business partners.  This allows our sales teams to identify trends more quickly and act upon them.  Following significant IT investment, the database now links directly to our core registrations and claims system, meaning manual input has now been eradicated – further improving the quality of information within the database.  This investment is yet more evidence of Car Care Plan putting the customer at the heart of our business – listening to what’s gone wrong and dealing with it. 

This Newsletter has been produced by Car Care Plan’s Compliance Team.

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