So, you passed on that extended warranty? Well, don't come crying to Warrantech when your computer goes on the fritz. Warrantech provides extended warranty services and service contracts to distributors, retailers, and manufacturers of such items as automobiles, automotive components, appliances, consumer electronics, power tools, recreational vehicles, heavy machinery, office equipment, fitness equipment, lawn and garden equipment, and computers and peripherals. Contracts range in duration from several months to several years and are underwritten by parent company AmTrust Financial Services. Active mainly in the US and Canada, Warrantech typically sells more than one million service contracts per year.
Warrantech sells its products through both a direct sales force and marketing agreements with independent agents. It also utilizes direct marketing techniques such as bulk mailings and telemarketing, and provides call center, claims management, training, and technical support services to its clients. The company continues to add new products and services to its menu, including extended service coverage for items such as sports gear, e-readers, 3-D televisions, and iPads. It is also growing its client roster.
Investment firm H.I.G. Capital, along with AmTrust, acquired Warrantech in 2007. AmTrust bought out H.I.G. Capital's nearly three-quarters stake in the firm for nearly $43 million in 2010, giving it full ownership of Warrantech. The firm is now part of its parent company's specialty risk and extended warranty segment and brings in other source of fee income. – less