By: John Barbero, President, Legacy Growth Partners
Most experienced dealer principals already understand reinsurance.
The more important question is whether their current program is structured to deliver its full revenue potential.
Having Reinsurance Isn’t the Same as Optimizing It
Once a reinsurance program is established, it can easily become part of the dealership’s financial background.
The provider stays the same. Products continue selling. Revenue continues flowing.
But “working” and “optimized” are two very different standards.
Look Beyond the Surface
Evaluating reinsurance performance requires looking at the program’s economics.
That includes:
- Product costs and provider fees
- PVR performance
- Products sold per deal
- Participation in the economics generated by those products
- Transparency into where the money is going
We often see dealerships focused heavily on PVR while overlooking another important part of the equation: how much of the underlying financial structure ultimately benefits the dealer.
The Cost of “I’m Happy With My Provider”
A longstanding provider relationship can be valuable. But longevity alone doesn’t prove that the current structure is producing the best financial outcome.
The real question is:
What is that relationship worth to your dealership, and what could an alternative structure produce?
You don’t have to disrupt a successful operation simply to understand the answer.
Know What Your Program Is Capable of Producing
For more than 30 years, Legacy Growth Partners has specialized in automotive F&I and revenue strategy, helping dealerships evaluate existing structures and uncover opportunities to keep more of the profit potential they already generate.
If you haven’t evaluated your reinsurance structure recently, it may be time to find out what you’re leaving on the table.