Mechanical Breakdown Insurance Updated: 01/19/2000

History - Founded in Insurance rating - ‘A+’ A.M. Best. Support - Specialized claims and policy services. World class... Partnership - Member of the Zurich Group since 1982

Products in the Market Place Manufacturer’s Warranty (3yr/36K) Mechanical Breakdown Insurance (MBI) –Rates are set & filed with the TDI! Vehicle service contract (VSC) –No Set Price!

Breakdown of Sales Volume Source: Wall Street Journal 1/7/97.

Reasons to Sell MBI Agents receive 20% commission up to $160 per policy. Commission paid up front. Charge back only if policy is cancelled in first 12 months.

Payment Options Single premium. Financed in auto loan. 24 equal payments.

Eligibility Customer must have liability, comprehensive and collision coverage (with any carrier). The MBI policy must be purchased within 30 days of the vehicle purchase unless the vehicle has less than 36,000 miles and is still within the manufacturer’s basic warranty. Vehicle must have less than 75,000 miles and be a 1993 or newer.

Eligibility cont. “NEW” (New > 3yr/36K) MBI can be purchased anytime! “USED” (3yr/36K ----->93/75K) MBI can only be purchased within 30 days of vehicle purchase!

Terms –6 years/100,000 miles –6 years/60,000 miles –5 years/75,000 miles –4 years/60,000 miles –3 years/45,000 miles –2 years/30,000 miles Terms begin on the policy date of sale. Mileage is in addition to the current odometer reading.

Coverage Options Preferred (Named Parts) – Engine, Transmission, Drive Axle, AC/Heating, Electrical, Suspension, Brakes, Interior/Exterior, & Steering. Comprehensive (All Risk) – Provides coverage for all mechanical failures except those specifically excluded.

Automatically Included Rental car provision for breakdowns ($25 per day based upon repair-6 day max) First day rental Trip interruption feature will reimburse you for food and lodging when you are 100 miles from home (three day $100 per day) Towing reimbursement up to $35.00

Claim Features and Benefits Repairs can made at any repair facility that warrants their work unless still within manufacturer’s warranty. Retail parts reimbursement. Posted Labor Rate. Three payment options: - Direct payment to repair facility. - Credit card payment to repair facility. - Customer reimbursement.

Farmers MBI is like no other Coverage is transferable when the vehicle is sold adding resale value. Farmers MBI provides up to $100 per day for trip interruption expenses. Only one deductible per visit regardless of the number of covered parts being repaired. No pre-purchase mechanical inspection. Vehicle may be taken to any repair facility. Expiration calculated by adding time/miles.

The Competition Are failures that are the result of normal wear and tear covered on all named components? Where can the vehicle be repaired? Is the price negotiable? Is rental car coverage available if the vehicle is only in the shop for a fifteen minute repair?

Now you know what Farmers MBI is, how do you introduce it to your customers??

How to bring up MBI to your customers on car change calls? Do you want the insurance only coverage or our new FULL coverage? Did you buy life and health insurance for your CAR? What is the mileage on this car as you may be eligible for our special mechanical coverage too? What kind of mechanical warranty did you purchase on your car?

Marketing Ideas Target car changes Target existing customers within months 20 to 35. Offer MBI on Auto Quotes Fame & Client Vision Mailings Dept. of Motor Vehicle lists Posters & Stuffers Child ID Booths Desktop Laminate - JUST ASK!

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