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Used car buyers opt for higher cover levels

Buyers are opting to purchase higher levels of cover with their used cars, says RAC Warranty.

It puts the growth down to consumer concern about unexpected repair bills during the credit crunch.

Demand for its gold and platinum parts and labour warranties has increased compared to the entry level silver product during recent months.

Ian Simpson, sales and marketing director, said: “In an economic slowdown, used car customers are willing to pay more upfront in order to minimise the chances of having to face an unexpected repair bill in a few months.

“This underlines that what customers desire at the moment, more than anything, are predictable costs. They are still willing to spend more money, such as an upgrading their warranty, if they believe that it represents value.”

Silver level as standard

The silver level of warranty cover is typically given as standard with a used car by FSA dealers to customers and the gold and platinum levels of cover are offered to customers during the sales process as options.

Simpson said: “Of course, this increased demand for more comprehensive warranty cover represents a stronger safety net for customers but also a genuine revenue opportunity for dealers during a period when overall margins are tightening.
 

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