Before you file — three things that strengthen it

1. Get the denial in writing

Ask for the denial in writing, identifying the specific contract clause relied on and, if an inspection was done, the inspector's report. A verbal denial is not something you can escalate. A written one citing a clause is — because you can then check whether the clause says what they claim it says.

If they will not put it in writing, send an email saying "as I understand it, you have denied my claim on the following basis…" and ask them to correct you if that is wrong. Silence becomes your record.

2. File a documented proof of loss and start the clock

Email or certified mail, with the date preserved. This matters because many contracts provide that if the provider fails to pay or provide service within sixty days after proof of loss has been filed, you are entitled to claim directly against the insurer standing behind the contract. That clause comes from the NAIC Service Contracts Model Act and applies where the provider met its financial-responsibility requirement by buying a reimbursement insurance policy — check your own document before relying on it.

3. Identify who is actually on the hook

Three names, all of which should be in your contract:

  • Obligor / provider — legally required to perform.
  • Administrator — decides claims. Often a different company from the one that sold to you.
  • Insurer on the reimbursement or contractual liability policy — pays if the obligor fails.

Every record on our ratings page lists the disclosed obligor, administrator and underwriter where the company discloses them at all — which a number of them do not.

Demand letter template

Send this alongside your complaint. Keep it to one page, send it by email and certified mail, and keep proof of the date.

Written demand — service contract claim

[Date]

[Administrator name]
[Address]

Re:  Contract no. [number] — written demand and notice of proof of loss
     Vehicle: [year, make, model, VIN]
     Claim no. [number], filed [date]

To whom it may concern,

I am the holder of the vehicle service contract identified above. On [date] I
filed a claim for [describe failure]. On [date] that claim was denied. The stated
reason was: [quote exactly what you were told].

I am requesting the following, in writing, within fifteen (15) days:

  1. The specific provision of my contract on which the denial relies, quoted in
     full and identified by section number.
  2. A copy of any inspection or adjuster report relied upon.
  3. The name of the obligor/provider of my contract and the name of the insurer
     issuing the reimbursement insurance policy or contractual liability policy.

Please treat this letter as a formal proof of loss under my contract. I note that
my contract provides that if the provider fails to pay or provide service on a
claim within sixty (60) days after proof of loss has been filed, I am entitled to
make a claim directly against the insurance company. I intend to exercise that
right if this matter is not resolved.

This matter has been documented with the Warranty Compliance Network under
reference [your WCN reference number], where it forms part of your company's
public record.

Sincerely,
[Name]
[Address, phone, email]

Check the sixty-day clause is actually in your contract before quoting it. Providers can meet their state financial-responsibility requirement three ways — a reimbursement insurance policy, a funded reserve plus a deposit with the commissioner, or $100 million in net worth — and the direct-claim right attaches only to the first. If your contract does not contain it, delete that paragraph; the rest of the letter still does its work.

If the provider has gone dark or out of business

  1. Stop the recurring debit with your bank or card issuer. Several providers in our dataset have continued taking monthly payments after becoming unreachable.
  2. File your complaint here and mark it as unresolved. A cluster of complaints against a company that has stopped answering is exactly the pattern our inactive-status flags are built from.
  3. Find the insurer. If a reimbursement insurance policy backs your contract, it is obligated to discharge the provider's obligations — including returning unearned fees — when the provider fails.
  4. Check our record first. Fourteen providers we track are already flagged as inactive, defunct or in run-off. If yours is one of them, the record will tell you what is known.