Warranty Direct have stepped in to help motorists who have fallen foul of a recently collapsed warranty firms non insured policies. Motorcar Elite have been exposed by BBC Wales for selling policies that were not supported by underwriters leaving customers out of pocket when the company collapsed.
Motorcare Elite provided warranty services to car dealers, which sold them directly to consumers. In the event of a bankruptcy or a dispute, warranty policies not backed by insurance are effectively worthless. Warranty Direct is stepping in to offer all Motorcare Elite customers a 25% discount on policies, as it did for Saab owners when the manufacturer recently went bust.
Unlike Motorcare Elite and many other warranty firms, Warranty Direct, which provides fully-protected insurance contracts, is regulated by the Financial Services Authority (FSA).
Duncan McClure Fisher, Warranty Direct managing director said “it's amazing that these guys got away with this for so long. We don't know every detail of the investigation, but it appears that their policies weren't worth the paper they were written on. To be properly protected, motorists should always opt for a warranty that is an 'insurance contract' rather than a '(non-insured) service contract'. Holders of insured policies can seek redress via the FSA, the Financial Ombudsman Service (FOS) and the Financial Services Compensation Scheme (FSCS) if they aren't happy. We can understand the frustration that their former customers must be feeling, so to help, we are offering a 25% discount for every former Motorcare Elite policy holder."