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Penetration for used car warranties increases

Dealers are continuing to increase penetration in used car warranties recognising the need to both sell more warranties and upsell the level of cover during the recession.

As a result, there has been a 30% year-on-year increase in sales of warranties at RAC Warranty in Q4 of 2009.

Ian Simpson, RAC Warranty sales and marketing director, said: “Dealers have recognised that warranties are an ideal way to generate extra revenue and have been, with our support, improving their warranty sales programmes in order to maximise the opportunities available.

“This is something that is very much welcomed by used car customers. In uncertain economic times, they want to avoid unexpected motoring costs and many want to increase the level of assurance offered by their warranty.”

Simpson added: “Where warranty sales are not reaching their potential, it is usually because there is a lack of commitment on the part of dealer management and a lack of understanding on the part of sales staff."

He expects warranty sales increases to continue next year.

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