shifting the bad from the good service contracts.TIP: Online research and some phone calls are essential to^
Do your online research, and dig deep—many RRGs look good on thesurface. Then make calls to your state’s insurance regulating agency, which (^)
is usually the Office of the Insurance Commissioner (OIC), and businessrating agencies like the Better Business Bureau. This is a great way to
determine if you’re looking at an RRG or legitimate service contractproduct.
LEGITITMATE CONTRACTS
What makes an RRG so different from a legitimate parts and servicecontract? The good ones are always a real insurance product, with all the (^)
oversight and regulation (both state and federal) that implies. Rates for realinsurance policies are determined by actuarial tables that come from
massive amounts of research on loss ratios, which are performed bylicensed actuaries. Regulations stipulate how much has to be kept in (^)
reserve to pay claims, give guidelines on fees and expenses, and basicallymake the service contract something worth considering.