Due to the economic recession, both General Motors and Chrysler have been forced to file for bankruptcy. The two giant car manufacturers have been iconic companies for many Americans and their financial problems are upsetting many people who have transactions with them, especially auto insurance dealings.
Over the months, more and more consumers have turned to the internet to seek advice and answers about their car warranties and insurance coverage. Media sites, blogs, and even advice columns have been flooded with a wide range of questions from GM and Chrysler car owners who fear having to contend with more financial woes because of their cars.
According to a recent survey, the questions asked fall into three distinct categories. The first set of questions deal with the possibility that insurance firms and dealers will not honor GM and Chrysler car warranties. The second delves primarily on the potential effects of the companies’ bankruptcy status on existing car insurance policies. Finally, the last series of questions are concerned with how outstanding car loans will be affected.
Despite the concerns of many consumers and car owners, officials from both GM and Chrysler said that the companies’ bankruptcy filings will not adversely affect the car owners.
Steve Harris, GM’s vice president for global communications, says that a large majority of the car warranties will be honored despite GM’s restructuring. The company has also sought the help of the Federal government in securing the active warranties of many cars. In March, the government announced the creation of the Warranty Commitment Plan to assure consumers that the warranties of their GM and Chrysler vehicles will be taken care of and honored as the two companies fix their financial problems.
Most Americans who have direct insurance coverage with major insurance companies or providers are generally to GM and Chrysler’s bankruptcies. The two car manufacturers’ financial subsidiaries, GMAC Financial Services and Chrysler Financial, also have strong financial records despite their mother companies’ woes. Consumers who have bought insurance policies with them are expected to be affected by the bankruptcy filings, but only slightly as the car giants find enough strength to get back on their feet. Industry experts, though, recommend drivers to check with their insurance providers to ensure that they have enough coverage for their GM and Chrysler vehicles.
Specialists also say that consumers have the right to be wary about the latest developments with GM and Chrysler but understand that this is not the end of the road. They say that the two car giants will emerge as stronger companies who will become more competitive and focus on better products. As a result, even car insurance rates can improve significantly for buyers of the companies’ new cars.