1SourceAutoWarranty.com Bankrupt. We Need Your Help

Our extended warranty company 1SourceAutoWarrantee (reinsurer is Primeguard) went insolvent. We are looking for members for a class action suit and to discuss ways of trying to recoup our losses. I started a Yahoo group. If you can help or have been burned, post to snipped-for-privacy@yahoogroups.com. To join or view previous messages go to

formatting link
Official info from the State can be found at
formatting link

Reply to
Steve Horrillo
Loading thread data ...

inappropriate link snipped

inappropriate link snipped

While it is likely that this is another attempt by a troll to engage people in arguments over some unknown whatever it is, on the off chance that this may actually be real...

Laws were passed years ago to prevent this. From what I understand, companies must purchase bonds to ensure that buyers of extended warranties do not suffer when they go out of business. Not difficult, as extended warranties yield about 90% profit for these companies (which is why nobody in their right mind would buy one unless there are really unique circumstances).

Instead of wasting your money on a lawyer who is simply going to walk away with all the money, why not ask the "government" agency you linked to what they can do to direct you to receive compensation.

Of course we all know that you are probably some sleaze bag lawyer trying to drudge up business...

************************* Dave
Reply to
DTJ

In the past, I would never get an extended warranty. But for modern vehicles, it's getting well worth it.

We are not talking worn out shocks or warped rotors. On-board computers, load leveling suspensions, brake force distribution systems, etc. Not cheap stuff to even diagnose, let alone the actual repair bill.

Thanks, Scott

DTJ wrote: >

Reply to
Scott Moseman

It is real. But as usual, it's not the whole story.

No, not exactly. In lieu of purchasing bonds, these warranty companies can sign up with Risk Retention Groups (RRGs) many of which are basically fly-by-night operations setup specifically to get around the insurance laws. By the time the attorney generals and insurance comissioners of a particular State figure out that a particular RRG is bogus and start revocation proceedings, a lot of customers have already been screwed.

For the record, the 1 source auto warranty company that they are talking about that was backed by a risk-rentention-group named primeguard; Primeguard Insurance Company Inc RRG failed on Dec 19, 2005. Primeguard is also based in Hawaii, that right there should tell you something.

1 source auto warranty, like a lot of these scammers, did a lot of online sales. It is likely the OP bought the warranty online. The problem with doing that is that the State Insurance comissioner didn't get a chance to even look at this company to give it pemisison to even sell in the OP's state in the first place.

Nothing. The government agencies involved have already decertified these folks, this is really a civil matter. It is quite likely that no actual laws were broken. It isn't 1SourceAutoWarrantys fault, they followed the insurance laws by getting a RRG to back their policies, when that RRG went bankrupt, that wasn't a failure caused by 1Source. While you can argue that Primeguard knew full well that they were simply engaging in a ponzi scheme, Primeguard would probably argue that it was the fault of companies like 1Source for submitting an unexpectedly large number of claims.

This is why the States have insurance comissioners and it is why if you do decide to buy insurance online, from an out-of-state insurance company, that you must basically do what you already pay good tax money for your state insurance comissioner to do - that is, investigate them and their underwriting companies. There are sites like

formatting link
that do this that you can pay to get access to their ratings.

No, the OP is one of these people who saw a deal and went for it without checking it out throughly. Now he has a pig in a poke and wants his money back. I guess he's never bought a used car in his life.

What the OP doesen't realize now is that he's getting setup to be victimized twice. Fiirst by the insurance scammers and second by the lawyers he wants to go after the scammers. Primeguard listed assets of 3 million dollars at failure, and they probably have a whole raft of creditors all lined up to get some of that. Any smart lawyer looking at this knows that payout on claims is probably going to be a few cents on the dollar, and won't be worth his time, so he is going to want fees upfront - and if the OP is stupid enough to pay those fees, the OP is going to lose even more money.

Class action lawsuits are only worthwhile when the company being sued is a going concern. They are useless for bankrupt companies because the bankruptcy court determines what gets paid out, you are better off just bypassing the lawyers and going directly to the bankruptcy court and registering all your unpaid invoices and waiting to see if you get anything. In this case the OP cannot list as a creditor with the bankruptcy court handling the Primeguard bankruptcy, only 1Source can, and 1Source obviously decided as soon as it's RRG failed, to simply go out of business, leaving behind a crowd of people like the OP.

What the OP needs to do is just understand that he paid a rather expensive tuition bill for the University of Hard Knocks, and move on with his life. We've all done stupid stuff in our lives that has cost us thousands of bucks, it's just part of life.

Ted

Reply to
Ted Mittelstaedt

"Ted Mittelstaedt" wrote

Well said, Ted. More specifically, I think this says something about the questionable value of extended warrantees in general, on all products. Sometimes its better to assume risks yourself in the first place.

Reply to
Dave Gower
[TOP POSTING CORRECTED as a public service]

If that were true, then peope would stop selling them because they would become unprofitable. On average, the companies selling these plans MUST take in more money than they pay out or they would go bankrupt. Consumers get screwed either way.

While that is true, that doesn't mean an extended service plan is somehow a better deal for "modern" vehicles (or for any other type of vehicle, for that matter). They are still structured to cover only those items that break infrequently and exclude those items that break often.

Statistically speaking, extended warranties will ALWAYS be a waste of money for the consumer, and a cash cow for the companies selling them. The house has an advantage, just like in Las Vegas.

Reply to
Scott en Aztlán

What losses?

The irony is that your chances of actually having a claim paid under your extended service plan are still about the same as they were before the bankruptcy. You kissed that money goodbye the day you paid it to Primeguard, not the day the company went bankrupt.

Reply to
Scott en Aztlán

Banks make money. They must be screwing us. Should we stop using banks? The grocery store is making money. They must be screwing us. Should we stop using grocery stores? Insurance companies make money. They must be screwing us. Should we stop using insurance companies? Of course companies that sell extended warranties are in it for the money, if not they would be working from a very poor business model. I'm glad that you see the logic in their business, but I'm not glad that you think a profitable business means they are screwing everyone.

I have had 2 extended warranties and both of them have MORE than paid for themselves -- with 1 or 2 visits to the dealership! Now, my old truck, never had an extended warranty, and it's never had to go into the shop (it doesn't have any fancy electronics/gadgets to break).

PS- Top posting very much intentional, thanks.

Thanks, Scott

Scott en Aztlán wrote: >

Reply to
Scott Moseman

P. S. PLONKing very much intentional, fuckyouverymuch.

Reply to
Scott en Aztlán

This is a good example of what not to do on Usenet. If you were capable of economically analyzing these simple questions, you'd both do it yourself. If you're not capable, then pointing out simple economic issues to you doesn't do any good. Instead, now you two have a stupid urinating contest going.

The reason you're arguing is that one of you is far more capable of economic evalutation than the other. Y'all can figure out who's who pretty easily.

Reply to
Joe

Scott, what your completely missing here is that the warranty companies the original poster posted about were professionally run shams that were in effect giant ponzi schemes set up to use loopholes in the law to screw consumers out of their money. They could never give any value for their money no matter how much warranty claims you would have had, because they didn't pay out any claims, they only took in fees.

For anyone that buys them, legitimate extended warranties have more chance of never paying out.

Ted

Reply to
Ted Mittelstaedt

MotorsForum website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.