A Generator OEM (or seller) wishes to offer a 5 year limited warranty. The OEM wants a solution that will provide strong financial backing for their limited warranty to satisfy clients, provide differentiation and potentially allow balance sheet relief
5 Year Limited Warranty Make-Up Example
The OEM is provided with a one-time cost to cover the warranty after an initial retention period and up to 5 years from the date of purchase.
In this example, the OEM will hold a retention period, the first 90 days of coverage in this example, and then the coverage will take over for the balance of 5 years. The retention is designed to ensure the coverage isn’t covering DOA units or improperly installed units.
The OEM in this example currently performs all the repair and claims administration under their limited warranty and would essentially continue to utilize the same process going forward subject certain requirements.
This model is an example only as each opportunity is unique and individually reviewed. No guarantees, coverages, accounting advise, legal advise or commitments are provided based on the information contained on this website.