FAQ
Straight answers to dealers’ questions
What is dealer-owned reinsurance?
It’s a structure where the dealer owns a reinsurance company that holds the reserves from the service contracts and other F&I products the store sells. Claims are paid from those reserves. What remains after claims and costs belongs to the dealer’s company instead of an outside warranty company.
Do I need to be a big dealer?
No. Programs make sense for independent stores selling about 7 or more service contracts a month. Stores selling fewer can start with a retro (profit-sharing) program.
How much can I earn?
It depends on your volume, products, inventory and claims. We walk you through the economics for your store on the first call. Results are not guaranteed: your company carries the claims, so a rough claims year means a smaller result.
Is profit guaranteed?
No. Your company carries the claims, so results vary. The reserves pay customers’ claims first.
When do I see money?
Premium is earned over the life of each contract, so the program builds over time. Money can be released once the book has seasoned, under the terms of your agreements.
What do I have to do?
Keep selling. We handle setup, accounting, filings, contract forms and claims coordination. You review a short performance report each quarter.
Do I have to change how my F&I team sells?
No. Your team sells the same way. The products are loaded into your DMS or menu system.
Who pays the claims?
Claims are handled by our partner claims administrator and paid from your company’s reserves, under the terms of each customer’s contract.
Can I customize the products?
Yes. Coverage, terms, rules and retail price can be tailored to your inventory and customers, within each state’s requirements.
Which products can be included?
Vehicle service contracts, tire & wheel, key/remote replacement and other ancillary products, depending on your state.
Where do you work?
We work with independent dealers nationwide.
How long does setup take?
It depends on your state and your program. We map out the timeline with you on the first call.
What does it cost?
Fees depend on your volume and program structure. We walk you through every cost on the first call.
What happens if I sell the dealership?
The reinsurance company is your asset. It can be sold with the store, or kept and passed on.
What’s the difference between retro and owning a company?
In a retro program the insurer owns the pool and pays you an agreed share of the profit, with nothing to set up. With your own company, you own the pool: the underwriting profit and investment income belong to your company.
What is Quantum Re’s role?
We are the consultant and captive manager. We design the program, form the company, coordinate every partner and run the books and filings. We are not the insurer or the obligor on your contracts.
Find out what your service contracts are really worth to you.
Book a 20-minute call with Andrei. We’ll look at your volume, your products and your state, and tell you plainly whether your own reinsurance company makes sense.