Monday, May 21, 2018

Help Members Stay Ahead of Unexpected Auto Repairs

by Nick Rohan, CUNA Mutual Group
Auto lending season has arrived for credit unions. Thanks to consumers’ ample access to credit, low debt burdens, strong job growth, growing hourly earnings and rising home values, auto sales are expected to top 17.1 million units in 2018. 

This outpaces the 16.5 million sales rate that economists believe is the inherent long-run demand. But what about protecting all of those shiny new rides out on the road? 

Growth in dealer-direct financing, indirect lending and online loan channels means that fewer members being covered by a mechanical repair coverage policy (MRC).

Traditionally, MRC has been offered at the time of closing the auto loan. However, because of time constraints, channel shift and administration challenges during the auto loan process, MRC is left out of the conversation all too often. 

Technology now allows for a combination of digital and traditional interaction touch points - outside of the loan event – providing more opportunities for members to learn about their options to guard against expensive repair bills. Fast, easy-to-use online tools allow members to research, compare and buy coverage at competitive prices. If members have questions, they can receive expert customer service through a dedicated call center. And, to help plan their expenses, members can pay upfront in full, or through a payment plan that fits their monthly budget.

“By guiding members through a transparent experience, they can now clearly review and consider their coverage options, where, when and how they prefer,” said Dan Gallagher, product executive, CUNA Mutual Group. “Ultimately, this puts members first by providing them with the right tools to make the right decision to protect their auto investment and safeguard against unexpected expenses down the road.”

For credit unions, expanded opportunities to extend MRC options through direct marketing can help them avoid missed to opportunities generated by indirect loan volume. The program also offers coverage options to members, who may not hold an outstanding auto loan balance, but could benefit from the added protection.  

“The new Mechanical Repair Coverage direct marketing channel expanded our reach to more members, helping them limit the cost of repairs,” said Mark Walls, VP of Consumer Lending, Neighbors Federal Union. “And, it took minimal staff time to get this program up and running quickly.”

Ultimately, fewer missed opportunities, more protected vehicles and the ability to cover repair bills at the garage are a win-win-win for credit unions and members alike. 

Learn more on how your members can benefit from this solution here. With auto buying season in full swing -- and summer vacation season around the corner -- the time is right!