Interview with Jim Ganther, President of the F&I Providers and Administrators Association

P&A Magazine sat down with Jim Ganther, President of the F&I Providers and Administrators Association (FIPAA), to explore how this new association will be contributing to the industry. The following interview discusses how the association was founded, key members, goals of the association and much more.

What was the impetus behind the Association?

Ongoing conversations between and among executives of numerous providers and administrators began almost two years ago as the US Fidelis fiasco unfolded. Other copy-cats sprang up in the St. Louis area, where US Fidelis was based, perpetrating the same sketchy business model. So the reputation of the entire service contract industry took a hit; the industry as a whole was being associated with the sales practices and other abuses of those companies. Reputable providers and administrators wanted to react, but how? This Association is part of that “how.”

Who established the Association?

I credit David Gesualdo with making sure the Association became a reality. He quarterbacked a number of conference calls among interested parties and, when no one seemed willing to “bell the cat,” he took it upon himself to pull the trigger. Part of that effort was recruiting Adam Kimber and me to join him in the effort. In hindsight, it made sense for guys like us to be the ones to get the Association started – we’re all close to the industry, but not actually employed by any specific company within it. This makes us as close to neutral players as you can find.

Who will run the Association?

The Association will be run by a three-member Board of Directors: David Gesualdo, Adam Kimber, and me. I am President of the Association, David is Executive Director, and Adam is Managing Director. We all serve without compensation.

What does the Association hope to accomplish?

One point most of the participating companies agreed upon was to establish a “Good Housekeeping Seal of Approval” that told the world that any company so designated was not a fly-by-night operation. In order to obtain the designation, a company would have to demonstrate it can meet certain objective criteria with respect to marketing practices, reserves, consumer satisfaction, Better Business Bureau rating, and so on.

Another goal is to establish a certification program for independent claims inspectors. Right now there is no way of knowing if an inspector has the knowledge and qualifications to conduct a fair, objective inspection. This is obviously of great interest to the companies that must rely on such inspections.

We also intend to create a certification program for provider and administrator personnel. The intention is to establish a baseline of knowledge for employees that will help them understand both the intricacies of their industry as well as the market they serve: retail automotive.

Long-term, we hope to assemble a wide range of member benefits that can help providers and administrators attract and retain employees, and enhance their customers’ experience.

Those are ambitious goals. How does the Association intend to achieve them?

Our first order of business is to establish an Advisory Council.

What is the role of the Advisory Council?

The Advisory Council will be tasked with creating working groups to undertake the heavy lifting necessary to turn our goals into accomplishments. We expect the working groups to consist of four to six experienced people from the industry who can get things done and report back their results to the Advisory Council for approval and implementation.

Another purpose of the Advisory Council will be to oversee the Board of Directors. The Association is a not-for-profit organization, and we intend to keep its financial affairs transparent to the Council. In addition, the Council will establish dues and membership criteria.

Finally, the Advisory Council will act to guide the activities of the Association. The Council will be primarily comprised of senior executives of member companies, as well as a representation from affiliated companies. We expect to meet at least twice annually in person in connection with the Industry Summit and Agent Summit in Las Vegas, with conference calls and webinars as necessary in between.

Who will be on the Advisory Council?

The roster is not yet complete, but we are very pleased by the number of respected industry members who have enthusiastically agreed to serve. Their initial term of service will be two years. We expect to announce the full Advisory Council in connection with the Industry Summit in Las Vegas, September 26 – 28.

How much will it cost to join?

That’s a matter for the Advisory Council to decide, but we expect it to be quite affordable. Member companies need to see a real value, and that’s hard if dues are astronomical. And as I said before, the Association is a not-for-profit organization, so the dues will be set accordingly. We need to generate enough revenue to accomplish our mission, not make anyone rich.

How much will it cost to receive the "Good Housekeeping Seal of Approval?”

Although we need to get Advisory Council approval, it is our hope to provide the designation for free, or for just a nominal handling charge. The problem with putting a high price tag on such a designation is that it creates the appearance of bias: the designating body only gets paid if it grants the approval. This hardly seems even-handed. Furthermore, I think it casts doubts on the integrity of an organization to generate income from such a program. It degrades the value of the designation. That’s one of the reasons we incorporated as a not-for-profit organization.

How much will the certifications cost?

Again, that needs to be determined by the Advisory Council – they’ve got a lot of work ahead of them! But we hope to keep the cost of certifications as low as possible. It is better for the industry if standardized training is made as widely available as possible and high fees would impede that.

When can companies sign up for membership?

We should have the membership criteria and dues structure shortly. Membership applications will be available at the Industry Summit in Las Vegas, and online at www.fipaa.org immediately thereafter. All providers and administrators that join before December 31 will be designated “Founding Members.”