I agree with the basic premise of learning from our past. However, using one’s past successes or failures when making decisions in this unprecedented reality may not be the best guidance (when so much has changed). Our focus in this critical moment should be looking forward and defining the pathway where we can make a controllable and relevant impact. Consider this…many F&I administrators today are promoting the logic and their support for digital retailing when they are still primarily using analog methods themselves to provide industry claim service support. Sound misaligned?

The F&I industry and the third party administrators that power it are a critically important piece of every dealer’s financial strategy. One can say with great confidence, without F&I’s income many dealers would financially fail. So given F&I’s critical importance, shouldn’t it lead with the F&I solutions a dealer needs to excel in the “new” reality? Where can F&I administrators make the most meaningful impact to help propel a dealer’s revenue and retention position today?

F&I administrators primarily offer “service” contracts, which by a simple definition are contracts for “service”. Many F&I administrators claim the greatest single thing that differentiates them from their competitors is how they uniquely service their customers. The perception of servicing strength is so important that all F&I administrators promote they have “best-in-class service”, “innovative technology”, “most advanced administration” and /or “highest level of service”. Sound familiar? The question is…do they or is this the space where F&I administrators can make the greatest industry transformation?

Consider the following two simple questions…

  1. Does our industry need more F&I products (as a primary focus today) or more relevant solutions to gain greater acceptance and improved overall experience for the F&I products we already have?
  2. Should a customer or dealer’s service advisor be able to engage all of the customer’s purchased F&I products (even if they are powered by multiple administrators) on one smartphone app in 2020?

Here’s the profound revenue/retention killing current environment and equally the unprecedented new opportunity for those leaders that are ready to seize it. How do most F&I administrators provide claim service support today? Don’t take my word for it, go look at your favorite F&I administrator’s website and click on the “claims” or “service” tab to see for yourself. Here’s what you’ll find…

  1. A 1800 number that leads to a phone queue and manually claim processing. All F&I administrators have an excellent, well trained team and a very capable administration platform that supports their internal processes. However, when a customer or service advisor calls in, it’s a manual entry / touch every claim process. I still hear CALL HOLD WAIT TIMES being used as a measurement of customer experience, when no length of time on hold is a good experience when having to make a phone call is the exclusive claim service pathway. By a stark contrast using the Amazon experience gold standard, if a customer ever has to make a phone call to Amazon (before or after the sale)…something failed.
  2. In some instances, you’ll find an archaic fill-in-all-the-blanks online claim form. Yes, the customer or service advisor has to type in name, address, city, state, zip, phone number, email address, year, make, model etc and many times also has to attach their service contract to prove they are a customer. Yikes! That’s an experience…just not a good one. The worst part is, it always leads to a phone call (see item #1).
  3. In even less instances, there is an anemic app or claim portal that only supports some F&I products or a single F&I administrator. In these limited instances, the administrator is asking their customers or service advisors to navigate a service maze determined by which F&I product or administrator they need to engage. It’s as much of a contributor to the current disconnected from reality engagement problem as is manual claim processing and archaic online claim forms.

The real tragedy of this analog anarchy pathway, is beyond the poor experience for everyone (that you can’t ever promote as “best in class service” at the point-of-sale), it’s ridiculously expense for the third party administrators to maintain. Other similar industries have already evolved and benefited from claims digital transformation, yet most F&I administrators are clinging to their old methods, looking in the rearview mirror and convincing themselves it’s still OK.