Important Message for Consumers
CNA National Warranty Corporation distributes vehicle service contracts through new-car franchised automobile dealerships across the United States . We do not sell directly to the public.
Consumer Alert for Internet Shoppers
Our products cannot be purchased via the Internet and we advise you not to be fooled by any online offers that refer to CNA National. If you are looking for this type of coverage, we urge you to start by contacting the dealership where you purchased your vehicle. Furthermore, we caution you to do your homework before buying a vehicle service contract from any Internet source; some of these programs have proven to be under-capitalized and under-insured, resulting in bankruptcy and/or failure to pay claims. (See “Buying Tips” below.)
Service Contract Buying Tips
Regardless of whether you are buying at a dealership or not, you want to determine whether the company you are considering is likely to be able to pay for your repairs in the years ahead. Here are some key questions to ask:
- Is the contract fully insured, and by which insurance company?
If it is not fully insured or is self-insured, we strongly advise you to keep shopping. - Is it insured by a Risk Retention Group (RRG)?
If so, we again advise you to keep shopping. In our opinion, this form of insurance, while suitable for some purposes, has not yet established a proven track record for the long-term payment of service contract claims. - How long has this company been in business?
Obviously the longer the better, but since service contracts can last up to 10 years, we recommend at least that long as proof the company is structured properly with adequate funds to pay covered claims. - Is the retail price high enough to cover the cost of future repairs?
Keep in mind that in order to cover legitimate claims in the future, all insurance companies need to collect and maintain adequate funds or “reserves.” If the price quoted is low compared to the competition, ask yourself, why? Be aware that most often in these cases, you get what you pay for. It is not unusual for under-funded companies to go out of business and stop paying claims.
Quick Buying Checklist
ü Fully insured by an insurance company.
ü Not insured by a Risk Retention Group (RRG).
ü Insurer in business 10 years or more.
ü Adequately priced to cover claims (not the “cheapest”).
For more information on the CNA National service contract program, contact your local representative or call us toll-free at 800.345.0191.