Deal Pack Blog
Is Force Placed Insurance Worth It?
In this ever-evolving world, more and more dealerships are looking to use Force Placed Insurance (also known as Collateral Protection Insurance or CPI). Is it worth it and what exactly is it?
Force-placed insurance, also known as creditor-placed, lender-placed or collateral protection insurance is an insurance policy placed by a lender, bank or loan servicer on a vehicle when the vehicle owners’ own insurance is cancelled, has lapsed or is deemed insufficient and the borrower does not secure a replacement policy. This insurance allows the lender to protect its financial interest in the property. In times of major catastrophe and unknown acts of God, more people are finding themselves unable to keep their insurance due to a job lay off or other loss of income. Even though at the time of purchase, it may have not been necessary, financial situations can change. As a way of protecting their interest in the vehicle, more dealerships are turning to CPI which will protect their interest in the vehicle and can be added to the payment at any time deemed necessary. As a reminder, please google or check the laws of your state before engaging in this practice so that you will be compliant with the law.
If your dealership chooses to start adding this insurance to your payments, please know in advance that Deal Pack has already thought about you and already have the means in place to allow you to add this coverage to any customer. If you have more interest on this subject, any other subject or just want to know more about Deal Pack in general, please contact our support staff at 1-800-526-5832 and we will be glad to give you more information on the usage of Deal Pack or even a free Demo of our system.