How Loss Damage Waivers Can Benefit Your Dealership
What is Loss Damage Waivers or LDWs?
Loss Damage Waiver (LDW) is a promise by a dealer or rental company to NOT pursue collection or suit against the renter in the event equipment that is rented is damaged or destroyed. Though it works similarly to the offering of a traditional insurance policy, most states do not regulate it as such.
The major benefits of offering LDWs are as follows:
- Your dealership will become one of the easiest places to rent from- your customers will no longer have to worry about getting a certificate of insurance when they come to rent from you
- LDWs adds an additional revenue stream for your dealership- you can charge your customer a fee in order to purchase this insurance
- Your rental department can now be free to do what it does best-RENT and not have to worry about chasing insurance certificates
But BEWARE some dealerships think they are selling Loss Damage Waivers when in reality they are selling short term physical damage insurance and if this is the case you must be properly licensed to sell insurance.
A true LDW, is set-up so you are selling access to your insurance policy and do not need an insurance license. You can sell this for whatever price your market will allow and you keep the entire profit. More importantly, you know that you are protected, your customer is protected, and your equipment is protected. The dealership will now be able to rent to new markets and add a new revenue stream.
To learn more about Loss Damage Waivers and to see if you are properly set up visit ADI Agency today.