"Warranty Gold" Claims

kidevo1 · July 2003

I was ready to plunk down $1800 for another WG contract, but I I'm definitely going to wait now.

If your reading this out there WG, hope you get your act straightened out soon.

Or...I'm taking my business elsewhere.

jeremyjackson1 · July 2003

There is too much money in the industry for a strong company like WG not to try everything possible to get out of this rut.Although the dispute is not with WG...they are,like many many other companies, being affected.If anyone is strong enough to overcome it,I have faith it is WG.HAVE FAITH!

texaswolflady · July 2003

I spoke with cust service today and was told they should know something by this Friday, 7/11. What they are planning on doing is transfering everyone under the old adminstrator to their new plan. The new plan is like an insurance policy and will pay like an insurance policy does....either draft or check. Not by credit card, like the adminstrator currently was doing. I asked why they changed to this adminstrator from their old one and I was told WG did not like how the other adminstrator was handling their business. People with this adminstrator are entitled to one "payment vacation" which means no payment for either June or July. So if you have not spoken to them about this, it would be worth a call to get this done. I did not have to pay for June and that tells me WG is trying to really work this out and help current customers that are caught up in this mess.

I am going to call back this Friday to see what has been found out.

quigonjohn · July 2003

TWL, thanks. I too did a "payment vaction" for June. If I knew for sure I was being moved to the new administrator, I would probably stay with WG. I am concerned about the payment arrangements. Does that mean we will always have to fork over the money first, then wait and gt reimbursed, or will they do some sort of tele-check to the dealers where we are having service done? Please keep us informed.

garnes · July 2003

WG has been very nice on the phone, however they have been doing the "we should know by this Friday" thing over and over again. It's ridiculous. I think the truth is that they really don't know what to expect, but don't want to say that so they string you along with the "next Friday the judge will......" thing. I guess I don't blame them though.

A lot of lawyers are involved so I'm not so hopeful that things will work out quickly or equitably.

As for "Have Faith" - when you are talking about someone else having over $1,400 of my money for nothing at the moment - I'm sorry, I'll believe when I see something writing thank you. Faith is for the good Lord above, but when someone else has your money I'll trust in something written. What was that anyway? A WG employee???

redline65 · July 2003

I was planning on using my new Diamond plan to get my auto climate control fixed this week or next. Am I hearing that WG won't pay the dealership, I will have to pay for it out of my pocket and then try to get reimbursed? Do I still need to have the repairs approved by WG? I bought my policy around July 1999, by the way.

q45man · July 2003

You won't find many Dealers or Independents who will take a check from a warranty company without holding your car till it clears.
We all demand non recourse credit card payment or cash.
As even telechecks and guarant checks have a way of bouncing.........plus it cost us more than the credit card fees to insure the check.

Same with smaller lesss well known insurance companies.

redline65 · July 2003

My WG contract says that Interstate National Dealer Services, Inc. is the administrator. Is this still true?

artgpo · July 2003

Interstate National Dealer Services was WG's old administrator before switching to National. I have a WG policy on my wife's 99 Sable. I just cancelled the policy on my '03 Silhouette. I had a 10 payment plan and was 5 payments in. I figure it is better to lose $500 than to lose the entire $1,000. I ordered my bank not to honor any more WG auto drafts from my checking account and sent them notarized notice of cancellation. I think I will shop around for a better deal with a reputable company. WG was like gold but no longer in my humble opinion. There are too many "this Friday" excuses during the past month.

rmorin2 · July 2003

I have initiated a dispute for all the charges on my VISA for my WG policy and have asked VISA not to honor any more charges.

Are they still saying next Friday? What's the latest? Is our policy worth the paper it is written on?

redline65 · July 2003

I took my car to my dealership this morning to have some repairs done. My Service Advisor said he had a customer come in yesterday with WG, and when he called them they would not pay the claim. He said they didn't even give him an authorization number, just an address for where the customer could mail the claim to.

quigonjohn · July 2003

Well, yesterday I finally bailed out on WG. I called and the latest is that there is some action occuring on Aug. 1. After that, they'll see what's happening, but it looks like NWIG will remain insolvent. So, if WG can get enough reserves back, then the NWIG Warranty Gold customers will be moved to a new administrator/RRG. But what really made up my mind is another payment was due and they would not give me another payment holiday until this is resolved. They gave me 1 in June, but now I'd be forced to pay, and could very well be putting money into a sinking ship. Fortunately, I still have $1050 of my money I have never paid to WG, to put towards another warranty. So at least it's not as bad as it could have been, like if all this happened after I finished paying off my contract.

BTW, I went with American Auto Warranty, aawarranty.com. My coverage will be with Great American Insurance Group. I looked them up and they are rated A by AM Best. Also they are in a wide range of insurance services and other financial services, so hopefully they'll be OK.

redline65 · July 2003

Glad to hear they didn't get all of your money. I have to say though, I'll never buy an extended warranty from one of these 3rd party companies again. I'll get the manufacturer-affiliated warranty. You are more brave than I am for buying another 3rd party warranty.

quigonjohn · July 2003

Well I had (2) Third-Party Warranties in the past and never had much trouble. And I got a lot more dollar-wise in paid claims than either of those policies cost. One was from a company called MBI and I think the warranty/insurance was New Hampshire Insurance Co. The other one was from Allstate Parts and Labor Plus. I had a couple minor hassles along the way. One I had to fax the administrator a copy of my contract, (I think the MBI was handed off to a different administraotr mid-stream), and both of them I had at least one repair that they required to be seen by an inspector first. But all in all, they still were a good value.

texaswolflady · July 2003

I just spoke with Bob Hanfey, manger at WG ext 4749. He did mention that there will be more info on 8/1...see www.nwig.com

I was concerned about making the July payment and wanted to roll over to the new company without a down payment which he said they could not do. I asked him if he would hold off on my July payment ,due 7/20, until 8/1 and he said that he would do....He said he would not debit my card until 8/10 for my July payment. That allows me to wait and see what the courts may have by then.

If NWIG does complete the bankruptcy and WG can not recover any monies, then I will have not made my July payment and can decide then how I want to proceed.

ronc54 · July 2003

Spoke to WG several times today after finding out my mechanic won't get paid by them. I got rather testy with them on the phone the first time but give them credit for staying on the line. At least they are answering the phone and talking so I think they are trying to save the business. Seems that if the court ( in the Caymans) releases the money in the trust fund to WG they have another admin. lined up to handle policies. The trust fund is supposedly in the US and account frozen by US courts. I am suspicious of the story that US courts are allowing a Judge in the Cayman Islands to have any control over these funds. Aug. 1st is the date for the hearing in the Caymans to decide this issue on the WG trust account. If for some reason the US courts let this money go to the Caymans I think it is all over and WG will also go belly up.

redline65 · July 2003

From their web site:

Warranty Gold doesnt gamble with our customers money. Together with our Administrator, weve established a "Trust Reserve Account." This account is managed by our administrator to pay repair claims for the life of the contract. In addition, the reserves are insured not once, but twice to ensure the solvency of the contract. With Warranty Gold, you are protected for the life of the contract.

Sounds like a big gamble to me! Where's that double insurance when you need it?

cluncker · July 2003

I've read through the court documents on NWIG's site, and it looks like the Nebraska Bankruptcy hearing is scheduled for August 5th. Has some one heard differently?

PAman · July 2003

In chapter 4 of the JPL report dated July 16, 2003, NWIC acknowledges that they were successful in seizing "all accounts held in Warranty Gold programs." It seems that is a double-edged sword. "Yes, Warranty Gold, we admit those are YOUR funds, but sorry, we took them anyway." That sounds like me saying, "Yes, I know that is your lawnmower I borrowed, but sorry, I'm keeping it when I move out of town tomorrow."

At best, WG seems to be dealing with a court system in a typical third-world bannana boat republic that writes their laws in pencil, and the court decisions go to the side that has the sleaziest lawyers or pays the best kickbacks.

Personally, I've decided that Warranty Gold showed EXTREMELY poor judgement doing business with a company that had control of ALL of their reserve monies, and was incorporated in another country. At best, if this issue is successfully resolved and we suddenly have contracts worth their ink, I will let these contracts run out, but NEVER do business with a company like this again. For example, the NWIG refused to sign their 31 Dec 2002 audit, and they have pretty much refused to cooperate with the JPL investigators. If I had been working at WG and could advise the president of the company, I would have given them 30 days past the completion of the audit to sign it or tell me what's going on, or eles my business would have been pulled out of there. This case may not be on the scale of a Worldcom or Enron, but WG's management seemed to be using similar poor judgement.

I don't know who you can trust now; 1Source has another discussion running where they seem to be doing more tap dancing around hard questions than they are giving clear answers. They've even hinted at having the discussion shut down, but the edmunds host has refused to do so as of today. Good for him/her.

Maybe our only reliable choices are manufacturers' extended warranties, but they have their down sides as well......

Good luck to all

Joe

kidevo1 · July 2003

I just dont know anymore...but I think I've seen enough movies in my lifetime already to know there is something appealing to a certain group of people out there with wanting to hold their money in the Caymans!

garnes · July 2003

Thank you very much for the info. I think your analysis is right on. Of course I hope you are wrong and this works out somehow, but I think I'm screwed. I'm getting ready for this. In the future, I will not buy any such policy. The factory warranties are often so expensive it's not a bad idea to just keep your money and "self insure" the car. It'll probably be OK with the exception of some major blow-out.

I would not be surprised to see this industry as a whole take a big down-turn over the next few years.

redline65 · July 2003

Got my car back from the dealership today. As mentioned before, WG did not pay for my repairs (about $300). My service advisor said the repairs were approved, and they gave him an address where I could mail my claim. How can WG continue selling policies on their web site, which doesn't even attempt to provide any information about this situation? I can't wait to talk to them tomorrow...

quigonjohn · July 2003

Well Warranty Gold should pay any of the mailed in claims that NWIG was supposed to pay. Whether they will, who knows. But they keep saying they're looking out for their customers interests, so that would be the proper thing to do.

redline65 · July 2003

Warranty Gold doesn't pay claims, they just take your money. NWIG needs to pay the claims.

2crnot2c · July 2003

I have filed a complaint with the BBB. In the complaint, I have requested that Warranty Gold refund my amount without delay. The problems they have with NWIG is their problem. The consumers should get their monies back.

PAman · July 2003

First of all, by May 27, I don't think that NWIC was still being rated A- by A.M. Best or any other major, credible insurance rating firm. That is a misrepresentation of facts at best, if not outright fraud.

Second, it's my understanding that all WG contracts come with a 60-day review and cancellation period. If that is stated in writing in your contract, then copy that page of the contract, along with a copy of your original e-mail showing the date sent, and send it by registered mail to WG. They need to adhere to the terms of the contract, period.

Finally, PLEASE let everyone know how your BBB complaint turns out. There are literally thousands of us out here in the "fruited plains" waiting to see how WG is going to handle this matter.

Joe

quigonjohn · July 2003

I will file a coplaint too. The refund, be it in total within the 60 day period, or reduced for cancellations after the 60 day period, should be from WG, not the Administrator. And the fact that the Administrators funds are tied up should not be part of the problem. I will also pursue getting a full reimbursement since the reason I have cancelled is based on them failing to provide the service they agreed to, (I'm not just cancelling because I don't want this coverage after all, but rather because at this point in time I have no coverage as stipulated in my contract).

2crnot2c · July 2003

The main reason for going with WG was that they were located in Austin which is where I live and work.

As PAman mentioned, I am planning to send the contract page and a copy of my email along with their reply to WG to keep a written tab. Unfortunately, I don't see them honoring their contract. Before signing up with WG, I asked my Chrysler dealer what they thought of WG. The service deparment head had good words for them. Now I am not quite sure that the dealer will be singing WG's praise.

ms_mayor · July 2003

If I read post #695 correctly, you paid with a credit card. Have you contacted your card company to dispute the charge? At a minimum, it will throw the questioned amount out of your balance until resolution.

I've generally had excellent help from my card issuers when problems have arisen. Sometimes it has taken up to six months to resolve, but in the meantime there's never a worry about a credit blemish.

2crnot2c · July 2003

My credit card company already posted the charge and I paid it. When the posting and payment was done, I had no intentions of cancelling. So the question about disputing the charge is a moot point.

I find post #701 extremely "interesting". "thkck123" mentions not to buy from online companies and then directs us to an online company "autowarrantyguide.com". How odd. Another interesting point is that the web page at autowarrantyguide.com has good reviews for WG and other companies.

151ranch · July 2003

Please look at your contract and see if the contract is between you and NWIG, or you and Warranty Gold. If it is between you and Warranty Gold, you should file in small claims court if they won't cancel. I don't think it costs very much and you are in Austin, anyway.

Also, in Texas, service contracts are regulated by the Texas Department of Licensing and Regulation. Warranty Gold's license number is #289. Call the state at (512) 463-6599 or (800) 803-9202.

Good Luck

kidevo1 · July 2003

just curious...what is the "only true broker" on that page?

I checked and WG is listed on there along with a few other ones.

I dont get it?

2crnot2c · July 2003

I purchased a new car service contract on 5/27/03 and on July 3, I sent them an email requesting the cancellation. I had paid my $1339 in full using a credit card. WG said that they received the email and were processing the cancellation. I even called them up and they confirmed the cancellation process.

On July 22, I get the following e-mail:

July 17, 2003

This letter is to notify you that we have received your cancellation request
and are currently processing it. However, we want to take this opportunity
to make you aware of a situation beyond our control that will delay your
receipt of a refund.

Warranty Gold contracted with an "A-" rated insurer National Warranty
Insurance Risk Retention Group (NWIG) and third party administrator that is
responsible for insuring, reinsuring, and administering claims on behalf of
contract holders. With respect to Warranty Gold, NWIG assumed the complete
financial responsibility for our book of business. Due to an issue with
another company, NWIG, who is domiciled in the Cayman Islands, recently
entered into Provisional Liquidation. Provisional Liquidation is similar to
Chapter 11 bankruptcy in the United States. As such, the liquidators have
ceased administering claims and cancellation refunds for all contract
holders. Warranty Gold has met all of our obligations under our agreement
and has fully funded the reserve account as per our agreement. The
liquidators have "frozen" ALL accounts related to NWIG and the funds will
not be released at this time, notwithstanding our repeated requests.

What this means for you is that your cancellation refund will be delayed
until the reserve funds are released by the Grand Court of the Cayman
Islands. Once those funds are released and the court authorizes
cancellation disbursements, we will issue refunds in received date order.
We greatly apologize for any inconvenience you may experience and please be
assured that Warranty Gold is diligently working to resolve the issue with
NWIG and their liquidators.

NWIG has a website that offers additional information on the situation. You
can access it at <www.nwig.com>

Respectfully,

Warranty Gold, Ltd

garnes · July 2003

Boy - they sure make it sound like they WILL get their money - someday. I have my doubts though.

If you can't get a partial refund for the same reason you can't get a claim paid, maybe it's best to just hold on to the currently worthless policy and hope for the best. If they come through, people that stuck with them are still covered and will be reimbursed for any repairs. If they don't, then you're screwed either way.

If there was some sort of partial access to THEIR money then maybe people canceling now will get something while those that stick it out may be still left with nothing.

It's hard to say what will happen. I'm betting that after August 1 or 5 or whatever the date is - this still won't be resolved. This will go round and round forever most likely. If they ever do get their money, I can see people trying to get reimbursed for repairs on cars they no longer own.

Anyway, I hope to be wrong of course as I'm in this for over 1400 myself. I just can't believe this and will never buy one of these third party things again.

kidevo1 · July 2003

I would honestly recommend fighting them for every last penny at this point and even if this dispute does eventually get resolved. I would still demand for a refund.

The problem is...Warranty Gold's image has ALREADY been tarnished by this entire fiasco and I cant see them remaining in business much longer. Informed people still willing to purchase 3rd party warranties, will more then likely steer way and move towards Warranty Direct, 1-Source...or similar.

Get the money and RUN!

thkck123 · July 2003

Do not be fooled. any company selling coverage over the internet by e commerce with out showing you the contract or inspecting the vehicle, will never pay more in claims, than what you spent. find a company that brokers more than one carrier. I am a real person who has been ripped off by warranty gold and one source an will not take it any more! extended warranty info is the key!

2crnot2c · July 2003

To be fair to Warranty Gold, they did send me a sample contract before hand. When I signed up, I checked the contract they e-mailed me with the actual thing. It was identical (barring my name, etc). I also have a sample contract from 1Source and Warranty Direct.

As with "games" comment in post #706, I am going to be extremely wary of any company on online from now on. For me the selling point for Warranty Gold was that they were local. If I had any problem, I figured, I could always go and see them, instead of having to only phone/e-mail them.

skipper747 · July 2003

If you paid by credit card, and still have an active account, you should ask the cc company for a refund. It does not matter if you paid the bill with the charge on it.

My experience with Warranty Gold was very good until today. They paid claims that were much more than the cost of the insurance, and there was never any hassle. (My Jeep has been a disaster.) If they survive, and if they once again pay claims as they did with mine, keeping the policy would be a good idea. But I am concerned that they will be driven out of business if this is not resolved ASAP before too many people find out.

garnes · July 2003

All the comments about their reputation going forward are unfortunately correct. The stink from this may be enough to really hurt them.

artgpo · July 2003

I cancelled my WG policy a few weeks ago. On Saturday, I received a letter from WG telling me that no refund can be given until the business with the warranty insurer is settled. The way I see it, I am lucky I got out for "only" $500 instead of the full $1,000.00

What bothers me is that they are still advertising and selling contracts yet not paying claims. Should that not be illegal?

2crnot2c · July 2003

Their website does not seem to mention any details about the problems past consumers are having, and interestingly enough, their testimonials do not go past 2/21/03. Hmmm, I wonder what people would be saying now ...

jerry_efcp · July 2003

I purchased the Warranty Gold New Platinum plan in 1998. When I bought the plan, I was told that I will get a substantial portion (85%) of the premiums back if I never claim or use it.

My contract will expire soon, with no car problems ever requiring that I use it. Does any one have good/bad experience to get the refund back from Warranty Gold? How should I do to get it?

CarMan@Edmunds · July 2003

Hi jerry_efcp. If you scroll back through this discussion you will see that policyholders have been having a very difficult time getting any sort of money out of Warranty Gold lately. I am sorry to say that I have a feeling that you will have a tough time getting the money that you feel you are entitled to. Perhaps there are other policy holders out there who have been in a similar situation to yours who would be willing to share their experience with everyone.

Car_man
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Smart Shoppers / FWI Message Boards

2crnot2c · July 2003

Hello jerry_efcp. Warranty Gold has not yet given me my refund even though I cancelled withing their 60 day review period. What chance do you thing you'll get yours? I have learnt my lesson, though very expensively. I will not trust any third party "extended warranty" company again. There is still hope that WG might give my money back, but in my mind I have written off this money. I will fight them as much as I can.

riggi · July 2003

I contacted a television in Houston requesting media coverage of the Warranty Gold fiasco. The station contacted Warranty Gold, which prompted WG to send me a letter explaining the situation. I am not interesting in hearing the same story repeated over and over again. I believe that potential WG customers should be aware of what could happen if they purchase an extended warranty from WG. Any comments?

redline65 · July 2003

I think the company needs to at least post something on their home page to inform existing and future customers of the situation. It should be a crime for them to continue selling these policies that they can't even make good on. I will be filing a complaint with the BBB. I've also been informing my co-workers, friends, and family not to purchase a contract through WG, or any 3rd party warranty company for that matter. Word of mouth can be very effective. Media coverage is even better!

kab243 · July 2003

I purchased my warranty in March paying in full with a credit card. In May my car was totaled and I requested WG to cancel the contract. I have not received any refund yet. Thanks to an advice of skipper747 I contacted my Credit Card and filed a dispute. They told me I have very good chances to receive my money back.

Here is what BBB site sais about WG.
http://www.centraltx.bbb.org/commonreport.html?compid=98013592&am- p;national=Y
Customer Experience

This company has a satisfactory record with the Bureau.
To have a "satisfactory record" with the Bureau, a company must be in business for at least twelve months, properly and promptly address matters referred to it by the Bureau, and be free from an unusual volume or pattern of complaints and law enforcement action involving its marketplace conduct. In addition, the Bureau must have a clear understanding of the company's business and no concerns about its industry.

Additional File Information

Warranty Gold recently completed an agreement with First Automotive Risk Retention Group. First Automotive will be insuring and administering the claims on their contracts sold after June 8, 2003. In addition to First Automotive, the service contracts are reinsured by Northbrook Indemnity, an "A+" AM Best rated carrier.

jjamieson · July 2003

I emailed Warranty Gold regarding this situation citing impending media coverage. I also requested their management team communicate directly with us rather then using those that recite the company verse and are worried about their jobs at the same time. My opinion is unless they receive a favorable ruling from the Judge they are toast. Certainly as a result of the Class Action Suit that will surely follow if nothing else. Having expressed these opinions in my email I closed requesting a response. today I did receive their response but it was the same blather they recite over the phone only in written form. Their first line of defense seems to be that we contracted with NWIG not them. On one hand they wish us to believe they are honorable people and are looking out for our interests. On the other hand they want to distance themselves from their responsibility to honor the very contracts they sold to us. Has anyone heard of a Class Action Suit being filed? I think it's about time, don't you?

2crnot2c · July 2003

Apparently BBB has not mentioned my complaint to them. I guess it will take a few weeks for BBB to mention my complaint (if at all).

A.M. Best has not rated First Automotive. Even if WG is re-insured with GOD, that does not help. If it did help, then we (screwed customers) would not be having our present problems as there is a re-insurer for NWIG. The re-insurance part is a piece of gobbledygook meant to sway customers like me into getting new service contracts. When "push comes to shove" where are they? If the re-insurers did mean something, then we would all be getting our money back!!!

PAman · July 2003

If we all banded together I'm sure we could find some barracuda to file using us as petitioners.

Unfortunately based upon nearly every class action lawsuit I know of or have heard of, the only winners will be the lawyers. We will end up with worthless contracts but in return as "restitution" we will be given something stupid, like a $100 discount coupon for the next contract we buy. The lawyers will walk away with millions!

Joe

"Warranty Gold" Claims

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