What Type of Extended Warranty Applications Does Your Warranty Company Require ?

The type of warranty applications your company requires is based on what type of warranty company you are and what warranty segments your warranty products fall into. Each segment will require their own application requirements within premium and claims processing. Warranty segments may included Appliance & Electronics, Home, Auto, Power Sports, and Specialty warranty. Below are the 3 most common warranty companies types followed by the basic extended warranty application business requirements. By no means is this list inclusive, it is just place to start and does not include non warranty specific applications like HR, Payroll, etc. DRK Resources Tech LLC can help you with your warranty application requirements.

1.) The extended warranty third party administrator (TPA) does the administration work for a warranty company that sells warranties or sells and admins their own branded extended warranties. The TPA is responsible for processes premiums, claims and services the consumer that purchased the extended warranty. The TPA makes money by taking an administration or sales fee from the cost of the warranty purchased by the consumer while shedding their claims risk by paying a per contract premium to a warranty insurance company that underwrites and insures the warranty.

2.) The extended warranty insurance company insures the risk of extended extended warranty from a TPA by paying claims from a loss fund that is reserved from the warranty premium it receives on every warranty sold. Other risk loss options can include captive insurers and reinsurance.

3.) The full service extended warranty company has the ability to be a TPA, warranty insurance company and even sell their own branded warranty products.