Warranty Gold Purchased warranty company bankrupt On-line Based Nationwide
Purchased a zero deductable 7 yr/100,000 mile platinum warranty with 60 day money back guarantee. Then within 50 days I tried to use it when I found out I had leaking rear wheel cylinders. The garage called to get an approval and they said I would have to pay in advance and get reimbursed. This was not what I was told at the time of purchase.
I was told they use a corporate credit card to pay for all authorized repairs so the consumer does not have any out of pocket. I got the phone from the garage person, spoke to the rep and she informed me that they are in chapter 11 bankruptcy!
They said my warranty money has been frozen by the courts and I would have to pay for all repairs and wait until their assets are unfrozen before they would reimburse me. Forget that crap, I applied for my refund on the 58th day. Two months later, still no money.
Mike
Ocala, Florida
U.S.A.
4 Updates & Rebuttals
Mike
Ocala,Florida,
U.S.A.
PUBLIC NOTICE-- The Real Deal-- As it now stands!
#5Consumer Suggestion
Wed, September 10, 2003
PUBLIC NOTICE
Anyone who has an extended warranty issued by Warranty Gold, Ltd
Actual warranty claims and payments for Warranty Gold and 30 other such companies in the US are administered and paid by National Warranty Insurance Company, RRG (NWIC) of Lincoln, NE. Until just recently, NWIC was rated as an A+ company and "highly" recommended to anyone who wanted someone to administer their warrant policies. However, on June 6 2003, NWIC - which is incorporated and regulated in the Cayman Islands, filed for and was granted a Provisional Liquidation Order (PLO) by the Grand Court of the Cayman Islands (equivalent to being granted Chapter 11 bankruptcy protection under US law.) Pursuant to the PLO, G.T.L. Bullmore and S.L.C. Whicker, partners of KPMG in the Cayman Islands were appointed as Joint Provisional Liquidators (JPLs) for NWIC to help them reorganize their debt.
On Monday June 9 2003, after an initial look at the books for NWIC, the JPLs decided the company was probably in "very serious" financial straits and, even though a PLO "does" allow a company to continue to do business while they reorganizing their debt - just like Chapter 11 protection in the US, decided NWIC needed to immediately stop authorizing or paying any claims and underwriting any new policies in order to protect the nterests of their existing creditors. In light of the "foreign" interests involved (i.e. all
those US companies that used NWIC to administer their warranties), the JPLs filed for and were granted a Temporary Restraining Order (TRO) by the US Bankruptcy Court for the District Of Nebraska. This TRO "froze" all US assets associated with NWIC, including any held in trust or escrow - like the one's for all the US warranty companies, pending the final outcome of
the PLO in the Cayman Islands.
The current status of NWIC's pending PLO can be found at http://www.nwig.com/
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What does all this mean for those of you holding an extended vehicle warranty issued by Warranty Gold?
First off, Warranty Gold was caught as much flat-footed by this as all of you and they have no more control over the situation than you or I would if the particular bank we do business with suddenly declared bankruptcy tomorrow and all of "our" account funds were frozen until the courts decided what to do! Sure the FDIC insures our funds - so in the long run, we'll get
them back - but it could take quite a while for that to happen. Meanwhile, we'd be stuck having to deal with all the people we owned money to who we couldn't pay because we no longer had access to our funds!
Secondly, Warranty Gold "did not" stop uthorizing payments for any of their customer's claims. The JPLs assigned by the Grand Court of the Cayman
Islands for NWIC, who had control of the trust fund use to actually make those payments, made the decission to stop paying claims - even though the PLO allows such payments to continue - and then took legal action to "freeze" those funds to prevent anyone else from being able to use them!
So, Warranty Gold now finds themselves in a situation where there "are" still funds out there to cover any claims issued against their warranties but, due to the TRO obtained by the JPLs, they're unable to access any of those funds to pay anything! They, along with some of the other warranty companies hit by this, "are" out there fighting to get the funds released so
claims can be paid, but for now it's still all in the courts. If and when they gets the funds released, warranty holders will be reimbursed for claims paid "out-of-pocket" - note: it's mportant you still file a claim if you want to be reimbursement!
Is Warranty Gold still in business and do they still offer extended warranties?
Yes they are and yes, they still offer extended warranties.
How is this possible?
They now have a "new" administrator (1st Automotive Insurance) handling
their claims and payments.
Their contact info is:
Warranty Gold, Ltd
7501 Hwy 290 E Ste 101
Austin, TX 78723
email: bobh@warrantygold.com
Phone: 800-580-9889 x4749
Contact: Bob Henfey
Sam
Westland,Michigan,
U.S.A.
Check with your state's insurance regulation agency / Future Advice - Stick with Manufacturer for Coverage
#5Consumer Suggestion
Wed, August 20, 2003
In some states these warrenties are regulated just like an insurance policy. If that's the case in your state then the insurance commisioner should have on file info on any trust funds or third party guarantor who can make a claim with.
Future advice - Stick with the original manufacturer for any extended auto warrenties. They do cost more, but the reason is they actually honor the claims and reimburse the delaers directly. This doesn't mean you won't ever have problems but they won't make you pay up front for repairs and it's a lot easier to get GM, Ford or Toyota to honor their policies then these fly by night companies.
If you are buying a new vehicle and are ever offered exteded coverage by the dealer throgh any company other then the manufacturer just the no. The dealer is doing it because he is getting a sweeter deal to resell it. You can usaully go to any other dealer and still buy a manufacturers warrenty even if you didn't get the vehicle from them.
Jacqueline
Hammond,Indiana,
U.S.A.
Chapter 11 Bankruptcy? Not good. :(
#5Consumer Suggestion
Wed, August 20, 2003
The possibility of a refund is discouraging. Bankruptcy 11 is specifically for businesses. Review your Warranty papers to see if they did have a Trust or Insurance on their business. For some, this is a selling feature.
The amount you paid to purchase this warranty is not mentioned, however if it is in the thousands, be careful. You might get approached by loan companies, offering to purchase your refund. They'll take more than half of it, and then collect the rest for themselves. If this happens, you might not get very much back.
The Bankruptcy processing might take a long time. One year would be nice, but it might be even longer. Depending on the amount of money you spent, it might be worth the wait.
Review Florida State laws regarding this type of warranty, there might be some options to collect your refund from a different angle, through the Federal or State level.
You would do better to research independently, rather than to hire an Attorney. The legal advice might be too expensive. Even for a high amount. There's not much they can do for you.
I just wanted to post this address information for anyone else in your situation, who may have missplaced it:
Warranty Gold Ltd.
9111 B Research Blvd.
Austin, TX, 78758
Phone: 1-512-382-4747*
*This number is probably disconnected, however the specific Court, where the Chapter 11 Bankruptcy Trial is residing, Court case pending, might have the current number of the Warranty Gold Legal Staff.
Hope you get your refund, even if it takes a long time. Save ALL of your records.
John
Coral Gables,Florida,
U.S.A.
I was told the same thing too
#5Consumer Suggestion
Tue, August 19, 2003
6 weeks ago, I cancelled my policy and told I should have my money back today. When I called to find out the delay, they told me about their trust account problems and had no clue when I should receive a refund. If they are insured, they should contect their insurance company and arrange for some type of emergency credit to handle these problems. In the meantime, you may want to file a complaint to these 2 agencies:
https://www.texasag.org/forms/cpd_form/cpd_getinfo.asp
http://www.centraltx.bbb.org/complaint.html
Good luck!