Kelly Price, President

How do you define a "combo product"?

To me, it would be taking any combo of several offerings, and creating different opportunities based on needs of the dealer. We focus mainly on reinsurance for dealers, and we try to combine products that are good for reinsurance and high value to the customer.

When we put a combo together, we try not to reduce coverage – we try to keep it competitive and consistent, so when F&I manager sells it, they know they are selling the best thing. We work with the dealership to make sure we’re putting something in place that’s of value to their customers, and valuable to their reinsurance program. We will combine anything that meets dealer needs, but that also meets the expectations of the customer, and not just meeting a price point with coverage cut.

They can be designed several ways, and we don’t have one way we do it. We try to be flexible to needs of agents and dealers.

What types of products are you including in your combo packages today? Why?

The most popular, but I guess that’s really a matter of perspective. We combine dent and windshield/roadside assistance the most. Our other popular combo is paint and dent. Every agent might have different perspective as to popular choices.

We do have an off the shelf product, but if there is a product agents want to create, it depends on how it has to be filed, regulated, etc. Some of it may take time to set up, but we’ll try to work with them.

What are your top reasons behind offering combo products? What, if any, reasons would you have to not offer them?

There are a lot of benefits to offering it. An F&I manager only has so much time and so much space on a menu. If they are trying to present all those products separately, it is very time consuming and overwhelming to customer, so there is an advantage to bulking them together. But sometimes it’s only offered that way in a presentation as a combo vehicle enhancement product, but with separate contracts for each of them. We have to be cognizant of time and money and admin fees. We try to have one contract, and one admin fee to combine cost savings, but can’t always legally do that, so we have to look at all options.

For us it would be a reinsurance thing not to offer certain products in a combo package. High liability means losses, so if we don’t want to cover a specific product, we just write a stand-alone contract. Another reason would be if the state already provides coverage – some states require auto insurance to cover windshield, for example, so no reason to have a combo product on that.

Is the sales process for a combo product different than for an individual product? Can you give an example?

It certainly can be - if offered in a menu presentation, it allows you to create more value for one “option” – but, it can also be a downfall. If the customer truly doesn’t see value in one of the offerings, it tends to blow the sale of all products offered in that option.

Do you believe the combo product strategy will evolve in the future? What types of product combos do you anticipate in the next 2-5 years?

I think it’s evolved to the point where it’s going to be more creative, with different combinations based on what states will allow. It has evolved from a novel idea a few years ago to everyone doing it today. Five years ago, there were only a couple of us doing it.

Is there anything else you would like to add?

We try very hard to make sure that we add a lot of value to every one of our products. I would be very cautious of watered down product coverage within a combo offering. This will only cause dissatisfaction at the customer level, eventually leading to decreased dealer satisfaction. With our combo products, the coverage is never diminished.