Governor's Office of Consumer Protection Alleges that Extended Warranty Company NAVISS Misled Consumers
ATLANTA, GA – John Sours, Administrator of the Governor’s Office of Consumer Protection (“OCP”), today announced that NAVISS, L.L.C. has entered into a settlement with the agency. The St. Louis, Missouri-based company, which markets vehicle service contracts to consumers nationwide, is alleged to have disseminated misleading direct mail solicitations and misrepresented material terms of its vehicle service contracts to Georgia consumers.
The agency alleges that NAVISS’ direct mail solicitations falsely represented: that its vehicle service contracts would allow consumers to “continue coverage” and “extend” their factory warranties; that the company was affiliated with vehicle manufacturers; and that a consumer’s vehicle warranty is expiring or has currently expired, when these statements could not be substantiated. OCP also alleges that NAVISS made misleading statements to create a false sense of urgency among consumers. In addition, when Georgia consumers called the phone number on the mail solicitations, NAVISS’ salespeople allegedly implied that the company’s service contracts provided greater coverage than they actually did, and failed to disclose all the pertinent terms of its refund policies.
In settlement of this matter, NAVISS has signed an Assurance of Voluntary Compliance, requiring it to pay a $25,000 civil penalty, $25,000 for investigative expenses and $25,000 in cy pres restitution to be paid to the Georgia Governor’s Office of Workforce Development’s “Go Build Georgia” Education Foundation, for use in funding auto repair training programs.
The Governor’s Office of Consumer Protection offers the following tips to consumers on avoiding unscrupulous extended warranty companies, such as those involved in this case:
- If you are notified that your vehicle’s warranty is expiring, check to see if your own records substantiate that.
- Only the manufacturer can extend its original warranty. A separate company can provide you with a vehicle service contract, also called an “extended warranty”, but you should understand that it is not a continuation of the warranty you had under the vehicle manufacturer. If a company tells you otherwise, don’t believe it.
- Understand who you are dealing with. Is it the vehicle manufacturer? Is it a separate service contract provider? Or is it a third party who is only responsible for selling the warranty, but not administering it? If it is a marketing company, ask for the name of the company who will be administering the contract. If they won’t provide you with that information, don’t give them your money.
- Make sure you understand what issues would and would not be covered under the contract, clarify any vague or confusing statements, and always ask to see the contract in writing (and read it in full!). If a company says they cannot provide you with anything in writing until the deal is finalized, walk away.
- Evaluate whether the price being offered is really a good deal for you. Consider your vehicle’s age, mileage, the reliability of the make/model, your own track record with the vehicle, and how much you expect to pay on repairs and maintenance in a year. Also, consider any deductibles you would have to pay. Many extended warranties have deductibles on each claim, as opposed to an annual deductible.
- Beware of high pressure sales tactics, such as stating that if you don’t act immediately, the “special” rate you’re being quoted will no longer be available.
- Do not give out your bank account information or social security number over the phone.
- Check out the company with the Better Business Bureau (www.bbb.org) to see if there have been any complaints lodged against it.