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Warranty demand increases as finances squeezed

It’s hard to think of an area in business which isn’t being negatively affected by the massive inflation hikes and financial squeezes of recent months, but extended warranties on used machinery probably wouldn’t be the first thing you’d think of. However, the RAC reckons that when cash is tight, people want the peace of mind of extended warranty coverage on their used cars and bikes, avoiding the potential of a massive economic hit from any unexpected failure or breakdown.

Sean Kent of Assurant, the RAC’s warranty partner, said, “In periods of financial difficulty, we often see demand increase for longer and more comprehensive dealer warranties over and above the standard cover provided. This may sound counter-intuitive, but it actually makes perfect sense – at times when people do not have lump sums to spend on repairs, they can see the value in warranty cover more easily.

“What this means is that dealers should pay more attention to their warranty proposition as we enter the second half of 2022, ensuring that they have the right products and infrastructure in place to satisfy what is likely to be a growing customer need as the cost of living continues to rise.”

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