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Warranties are designed/written with the goal of paying-out as little as possible.
Cars don't work the same as other products. The warranty and the risk associated with covering repair is built into the price of the car. Car manufacturers do this because their brand is everything to them. Car manufacturers stand by their cars when they are under warranty.
OP, I've had luck calling the manufacturer directly to explain the situation.
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68,327 posts, read 54,350,985 times
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Quote:
Originally Posted by Labonte18
I'd agree with you if the failed bearing was on the same side of the vehicle that took the pothole damage.
Being on the opposite side of the car.. Just curiosity here.. This wouldn't happen to be a Kia, would it? I find it hard to believe that Ford, GM, Chrysler.. Anyone other than Kia or Hyundai would deny coverage in this situation.
Has it been conclusively established the dealer actually filed a claim that was rejected or is it possible that's just what the owner was told?
Cars don't work the same as other products. The warranty and the risk associated with covering repair is built into the price of the car. Car manufacturers do this because their brand is everything to them. Car manufacturers stand by their cars when they are under warranty.
You've never worked at a dealership then, have you? ALL OEM's will do what they can to avoid paying warranty claims as much as possible. (Or "shorting" claims based on some ridiculous SRT times.)
On average, a "good" dealer recovers 80% of their warranty costs. Think about that for a minute. For every $100 in claims a dealer sends to an OEM, the good ones can only get $80 of that back. It is very rare to see any dealer over 90% when it comes to warranty recovery.
I would say Ford and GM are the easiest to work with on warranty issues. Chrysler, Hyundai/Kia and Nissan are the absolute worst. Everyone else is in-between and about the same.
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68,327 posts, read 54,350,985 times
Reputation: 40731
Quote:
Originally Posted by iamweasel
You've never worked at a dealership then, have you? ALL OEM's will do what they can to avoid paying warranty claims as much as possible. (Or "shorting" claims based on some ridiculous SRT times.)
On average, a "good" dealer recovers 80% of their warranty costs. Think about that for a minute. For every $100 in claims a dealer sends to an OEM, the good ones can only get $80 of that back. It is very rare to see any dealer over 90% when it comes to warranty recovery.
I would say Ford and GM are the easiest to work with on warranty issues. Chrysler, Hyundai/Kia and Nissan are the absolute worst. Everyone else is in-between and about the same.
Having worked on the other side of the deal, I can tell you there's no shortage of dealers who whether intentionally or not overbill with their warranty claims with things such as trying to include a labor operation already included in another operation they've claimed, charging entire containers of various fluids when the warranty only pays for specific amounts, charging for a part that's already a part of another assembly they've claimed, etc., et., etc.. Often when they're only paid 80% of their claim it's because the company's warranty policies & procedures specifies that's all the warranty covers.
You've never worked at a dealership then, have you? ALL OEM's will do what they can to avoid paying warranty claims as much as possible. (Or "shorting" claims based on some ridiculous SRT times.)
On average, a "good" dealer recovers 80% of their warranty costs. Think about that for a minute. For every $100 in claims a dealer sends to an OEM, the good ones can only get $80 of that back. It is very rare to see any dealer over 90% when it comes to warranty recovery.
I would say Ford and GM are the easiest to work with on warranty issues. Chrysler, Hyundai/Kia and Nissan are the absolute worst. Everyone else is in-between and about the same.
I've worked at a dealership & I've been the one paying claims for the manufacturer & my dealers got 100% of their *valid* claims paid. There were dealers that routinely had 10 or 20% of their claims "stick" in processing- but that was a training issue with the warranty clerk, not claims being denied. At my manufacturer, as a zone-manager, properly coded claims got automatically paid by the warranty system, and I didn't even see those claims until the end of the month when random claims were pulled by myself and audited for accuracy. The only claims that relied on my prior authorization were large claims like engines & transmissions & out-of-the-ordinary claims like warranty paint repairs, additional labor time requests, glass& things of that nature.
My take on this, as someone who used to pay claims for a manufacturer - is that someone at the dealership decided to deny the claim.
Even at a small manufacturer, there's simply not enough hours in the day to pre-approve every claim. Some portion of claims must be automatically approved by the claims system in order for it to function.
As a zone-manager, I would have pulled the r.o. on a wheel-bearing claim on a low-mileage vehicle, simply because failures of that nature were very uncommon in my company's vehicles - and I'd have been looking for things like a customer-paid wheel on the same r.o. - that was the profile for a dealer trying to "get over" on the manufacturer (that kind of thing does happen). But opposite side, different r.o., and presumably mileage logged in between - would have been no problem.
As for the difference in billing between "customer pay" and "warranty" repairs - techs, service managers & some dealer managers would argue for days over it, but if you look at a dealerships overall costs and profits, warranty repairs are very profitable. Dealers have to advertise for customer-pay repairs & they have to pay service advisors (handsomely!) to talk retail customers *into* performing customer pay repairs. A valid warranty claim doesn't require any advertising or any sweet talk from a service advisor, it gets paid in just a few days without any credit-card fees or bounced checks. There's a built-in guaranteed profit on both the labor and the part. And there are some "deals" that dealer techs and advisors quickly forget about - like recalls. As in, every single vehicle produced has to come into a dealership & get an $800 fan-clutch or fuel-pump replaced.
Having worked on the other side of the deal, I can tell you there's no shortage of dealers who whether intentionally or not overbill with their warranty claims with things such as trying to include a labor operation already included in another operation they've claimed, charging entire containers of various fluids when the warranty only pays for specific amounts, charging for a part that's already a part of another assembly they've claimed, etc., et., etc.. Often when they're only paid 80% of their claim it's because the company's warranty policies & procedures specifies that's all the warranty covers.
Certainly there are some dealers who don't know what the heck they are doing when it comes to warranty claim submissions. I'm not going to argue that, and those guys are usually stuck in the 50-60% on the warranty recovery chart.
Getting techs to write stories correctly, detailing every move they made during a repair, is the biggest challenge most dealers face when submitting claims. You leave out some steps, certainly you won't get paid for some of it.
That being said, the SRT times are usually too low and the OEM's tend to stick to their guns on that stuff. That plus looking for any piece of evidence they can find to deny a claim are the two biggest gripes I had on the dealer side. (And my dealership's recovery rates were typically 95-98% so we knew how to do it right, but I also paid our warranty manager a lot more than other dealers because to me that investment was worth it.)
I've worked at a dealership & I've been the one paying claims for the manufacturer & my dealers got 100% of their *valid* claims paid. There were dealers that routinely had 10 or 20% of their claims "stick" in processing- but that was a training issue with the warranty clerk, not claims being denied. At my manufacturer, as a zone-manager, properly coded claims got automatically paid by the warranty system, and I didn't even see those claims until the end of the month when random claims were pulled by myself and audited for accuracy. The only claims that relied on my prior authorization were large claims like engines & transmissions & out-of-the-ordinary claims like warranty paint repairs, additional labor time requests, glass& things of that nature.
My take on this, as someone who used to pay claims for a manufacturer - is that someone at the dealership decided to deny the claim.
Even at a small manufacturer, there's simply not enough hours in the day to pre-approve every claim. Some portion of claims must be automatically approved by the claims system in order for it to function.
As a zone-manager, I would have pulled the r.o. on a wheel-bearing claim on a low-mileage vehicle, simply because failures of that nature were very uncommon in my company's vehicles - and I'd have been looking for things like a customer-paid wheel on the same r.o. - that was the profile for a dealer trying to "get over" on the manufacturer (that kind of thing does happen). But opposite side, different r.o., and presumably mileage logged in between - would have been no problem.
As for the difference in billing between "customer pay" and "warranty" repairs - techs, service managers & some dealer managers would argue for days over it, but if you look at a dealerships overall costs and profits, warranty repairs are very profitable. Dealers have to advertise for customer-pay repairs & they have to pay service advisors (handsomely!) to talk retail customers *into* performing customer pay repairs. A valid warranty claim doesn't require any advertising or any sweet talk from a service advisor, it gets paid in just a few days without any credit-card fees or bounced checks. There's a built-in guaranteed profit on both the labor and the part. And there are some "deals" that dealer techs and advisors quickly forget about - like recalls. As in, every single vehicle produced has to come into a dealership & get an $800 fan-clutch or fuel-pump replaced.
Warranty repairs are profitable, but not as much as retail work given the low SRT's in many cases and many OEM's limit the parts markup as well. The labor rate is the same so that's a wash. You also need extra staff to submit and account for warranty claims that you don't need with retail repairs. It's not the cash cow you make it out to be. But still profitable, yes, and that's great.....but if an OEM doesn't want to pay for warranty claims then don't put bad parts in your vehicles.
You still have to advertise for warranty work because there are multiple dealers in each town. In addition, if you don't provide a good experience during their first warranty visit then most likely they won't come back a 2nd time.
Many dealers also do not get paid "in just a few days" as it can take OEM's 30-60 days to pay a lot of the claims. (From date the RO is closed to the date the money comes in.) With retail repairs you get paid on the spot most of the time, so you have a lot of cash tied-up just to cover the delay in getting your warranty payments. It's funny how if a dealer is one day late on paying their parts bill they can't order any more parts, but the OEM's can take 30, 60, and 90 days to pay warranty claims and sales incentives. Go figure....
Last edited by iamweasel; 04-23-2019 at 09:32 PM..
Reason: typo
I have a car that is still under factory warranty. I hit a pothole that damaged two passenger side wheels, so I had them replaced at the dealership. About a month later, a wheel bearing fails on a driver's side wheel and they want to charge me to replace it. I asked if it would be covered under warranty, to which they said no. They claim the manufactured denied warranty coverage due to my recent "repair history" (the wheels I just had replaced). I told him that the failing wheel bearing is on a wheel that didn't even get damaged, and the guy basically shrugged his shoulders and said that's the way it is.
Is that even a legitimate excuse to deny a warranty-coverd repair?
Just when I thought I saw everything. The crooked bastards found a way to call it a pre-existing condition.
I have a car that is still under factory warranty. I hit a pothole that damaged two passenger side wheels, so I had them replaced at the dealership. About a month later, a wheel bearing fails on a driver's side wheel and they want to charge me to replace it. I asked if it would be covered under warranty, to which they said no. They claim the manufactured denied warranty coverage due to my recent "repair history" (the wheels I just had replaced). I told him that the failing wheel bearing is on a wheel that didn't even get damaged, and the guy basically shrugged his shoulders and said that's the way it is.
Is that even a legitimate excuse to deny a warranty-coverd repair?
Escalate up the dealership chain of command, and up the manufacturer chain of command.
How old and how many miles on the car?
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