Optional Warranties. Dealer Program Guide

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1 Optional Warranties Dealer Program Guide

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3 Why Offer Optional Warranties From Carrier? Four (4) labor rate options. See page 11. Choose your labor rate based on your reimbursement needs. Rates are even adjusted for inflation and market factors. Talk to your distributor to find out more. Two (2) coverage start date options for labor rate plans. See page 11. Choose the traditional 366th-day start, or offer even more protection with a start date of 31 days after the sale. Simple, more flexible coverage options. See page 12. Multiple contract possibilities including Parts Only and Labor Only that are easy to explain to the homeowner. Clearly defined coverage. See page 13. Guidelines make it clear what s covered and what s not, and clarify claim submission policies, which are strictly enforced. Better management and sales tools. See page 22. Regular reporting, improved sales tools and the Assessment Score metric will help you manage your optional warranty business more effectively. 3

4 An easy path to higher profits. Offer your customers peace of mind and improve your bottom line at the same time with the Carrier Optional Warranty Program. If you have any questions about this guide or about Carrier s optional warranty products, eligibility or pricing, please contact your distributor or contract administration. Carrier Corporation Contract Administration (866) What s so great about it? Well, it gives you more options for one. But it also keeps things simple. These warranty products are easy for you and your customers to understand, and you might like this best of all life is easier for you on the administrative end. This program guide has all the information and forms you need to sell and manage Carrier s optional warranties, build long-lasting customer relationships and expand your profit margins. You ll also find details on some important changes in procedures and requirements as well as tools to help you evaluate and manage your warranty business. Most of all, in these pages you ll find all the options you need to provide security for your customers and new profit-making opportunities for your business. 4

5 Carrier Optional Warranties Program Guide Contents 1. Optional Warranties and Your Business pg 6 Developing Your Business Advantage pg 7 Calculating the Financial Benefits pg 8 Improving Your Cash Flow pg 9 Evaluating Your Business Needs 2. Warranty Plans pg 10 General Contract Guidelines pg 10 Contract Offerings pg 11 Labor Rate Plans pg 11 Program Allowances 3. Program Policies pg 12 General Guidelines pg 13 What s Covered, What s Not 4. Participating in the Program pg 14 Dealer Registration pg 15 Creating and Registering Contracts pg 16 Contract Registration Guidelines pg 17 Filing a Claim pg 19 Claim Guidelines pg 21 Dealer Termination pg 21 Transferring Contracts 5. Program Evaluation Tools pg 22 Assessment Score pg 23 Reporting 6. Appendices Contract Administration Contact Information Appendix A Eligible Equipment Appendix B Allowable Labor Hours Appendix C Recommended Parts Inventory Appendix D Dealer Participation Agreement Appendix E Parts Credit Claim Form Appendix F Labor Only Claim Form Appendix G Warranty Registration Form Appendix H Dealer Transfer Form Appendix I Homeowner Transfer Form Appendix J Distributor Authorization Form Appendix K Service Ticket 5

6 1. Optional Warranties and Your Business Carrier customers live busy, fast-paced lives. They don t have time to worry about their indoor comfort system failing or who to call for service. With Carrier s Optional Warranty Program, you can take care of these details for them, give them peace of mind, and build profitable customer relationships for your business. Carrier s Optional Warranties Parts Only and Labor Only can reduce the risk of future repair costs for homeowners, giving them peace of mind. Developing Your Business Advantage Carrier s full line of top-quality indoor comfort equipment already differentiates you from other dealers. Our Optional Warranty Program can help you offer customers the extra protection they re looking for, and improve both your service and add-on/replacement business. Offering optional warranties as part of each sales call can increase the confidence prospective customers have in the equipment and open the door for additional sales down the road. Because these warranties can reduce the risk of future repair costs for homeowners, you will find that customers are very interested in finding out more. Plus, you ll be the first dealership they call for service. Carrier prints your business name right on the warranty contract. So you ll enjoy a nice profit from the warranty sale and create the potential for revenue year-round from future repair needs. You can gain both warranty sale profits now and potential service profits year-round. Carrier s program is one of the most competitive programs available. It offers parts mark-up on labor contracts and includes travel and diagnostic time there s almost no liability for your business. Your customer is happy and Carrier strengthens its reputation as the Experts in home comfort solutions. It s a winning situation for everyone. 6

7 Calculating the Financial Benefits for Your Customer: Here are typical homeowner repair scenarios that illustrate how selling Carrier s Optional Warranties can provide financial benefits to both your customers and your business both now and down the road. First Repair: Three years after purchase Your customer needs a replacement condenser coil for a three-year-old 12.0 SEER 5-ton Puron refrigerant A/C unit. Second Repair: Seven years after purchase Your customer needs a replacement condenser coil for a seven-year-old 12.0 SEER 5-ton Puron refrigerant A/C unit (no longer covered under the Standard Warranty). Assumptions Cost of part: $619 Labor rate: $90 Cost of Puron refrigerant: $9/lb Assumptions Cost of part: $619 Labor rate: $90 Cost of Puron refrigerant: $9/lb Scenario A (no optional warranty) The homeowner is covered only under the Standard Warranty. Scenario B (optional warranty) The homeowner purchased a 2-10 yr Labor with 6-10 Parts warranty with the system. Scenario A (no optional warranty) The homeowner is covered only under the Standard Warranty. Scenario B (optional warranty) The homeowner purchased a 2-10 yr Labor with 6-10 Parts warranty with the system. Travel: $45 Diagnostic: $45 Puron refrigerant: $72 Labor hours (4 hr): $360 Cost of part*: - Parts mark-up - Paid to Dealer: $522 Cost to homeowner: $522 Travel: $45 Diagnostic: $45 Puron refrigerant: $72 Labor hours (4 hr): $360 Cost of part*: - Parts mark-up: $100 Paid to Dealer: $622 Cost to homeowner: $0 Travel: $45 Diagnostic: $45 Puron refrigerant: $72 Labor hours (4 hr): $360 Cost of part: $619 Parts mark-up - Paid to Dealer: $1141 Cost to homeowner: $1141 Travel: $45 Diagnostic: $45 Puron refrigerant: $72 Labor hours (4 hr): $360 Cost of part: - Parts mark-up: $100 Paid to Dealer: $622 Cost to homeowner: $0 *Covered under Standard Warranty Bottom line: Scenario A: The homeowner purchased a system three years ago but now has to pay $522 for labor costs to replace a part covered under the Standard Warranty. Scenario B: The homeowner pays nothing out of pocket on this repair and the dealer earns an extra $100 in parts mark-up. Both the homeowner and the dealer benefit from the purchase of an Optional Warranty when the system was sold. Bottom line: Scenario A: The homeowner purchased a system seven years ago but neglected to register for the standard enhanced parts warranty now must pay $1,141 for parts and labor to replace a part no longer covered under the Standard Warranty. Scenario B: The homeowner pays nothing out of pocket on this repair and the dealer earns an extra $100 in parts mark-up. Again, both the homeowner and the dealer benefit from the purchase of an Optional Warranty when the system was sold. 7

8 Improving Your Cash Flow Through Optional Warranty Margins You may think that selling optional warranties isn t worth the effort that you re good at selling and servicing equipment, and you d rather focus on that. But selling optional warranties may be easier than you think and the financial benefits speak for themselves. Consumers typically pay 15-20% of the purchase price for optional warranties on expensive appliances. Gain a competitive advantage. As the HVAC business gets even more competitive, optional warranties can help you offer something attractive to homeowners and unique in your market. Consumers expect some level of protection when purchasing big ticket items, and optional warranties are a great way to extend that to them with the sale or soon afterward. Boost margins. With profit margins on equipment sales and service shrinking in some markets, optional warranties give you one more way to increase your margin on each equipment sale. Don t forget. Even if you do not sell the contract at time of installation, contracts can be sold up to one year from date of installation. Sell more maintenance agreements. Carrier s Optional Warranties go hand-in-hand with contracts for regular system cleaning and maintenance. The optional warranties become void if the equipment is not properly maintained, so offering optional warranties and a maintenance agreement along with an equipment sale is a natural fit and can make you the one-stop-shop for all your customers indoor comfort needs. 8

9 Evaluating Your Business Needs How do you know if Carrier s Optional Warranty Program is right for you? See how this checklist lines up with your business needs. Want to boost profit margins Interested in establishing a continuing relationship with customers Want to offer years of protection to customers Would like to offer customers peace of mind to accompany their new investment Interested in flexible coverage, labor, and program benefits Want to make repair bills less expensive for your customers Did you know? Homeowners and Optional Warranty Programs Homeowners are familiar with optional warranty contracts. Most appliance and electronics stores offer them right at the checkout counter. 90% of dealers surveyed reported that optional warranty contracts strengthened their relationships with homeowners. Over half of consumers surveyed reported feeling that optional warranties provided peace of mind after the sale. Optional warranties offer security for homeowners. By paying for protection up front, homeowners have a hedge against uncertainty and costs associated with repairs. According to Consumer Reports, consumers typically pay between 15 and 20% of the total sale price for optional warranties when purchasing high-priced appliances that require high-priced repairs. 65% of dealers surveyed reported selling an optional warranty with 3 out of every 4 equipment sales. Carrier s Optional Labor Only Warranties are a good way to generate repeat/aor business for a dealer, because only the dealer registered on the contract may service a warranty claim. If the homeowner has already worked with you on more than one occasion, you are more likely to get the call about upgrading the system when that contract runs out. 9

10 2. Warranty Plans Flexibility. Simplicity. Now you have both with Carrier s warranty contract options. First, pick the type of contract you want to offer. Then, pick the reimbursement labor rate you want to use. It s all designed with you in mind so you can create the program that works best for your customers and for your business. Carrier dealers can pick from four hourly rates to use for labor reimbursement under optional warranties. General Contract Guidelines Installation eligibility. These optional warranty contracts are for eligible residential equipment in owner-occupied installations only. Covered parts. Coverage under the Optional Warranty Program is limited to the failed part only. For complete coverage details, see Section 3, Program Policies. Compressor coverage. Previously purchased Parts & Labor warranties for split system air conditioners, heat pumps or packaged products up to 5-ton do not cover compressor parts; however, these warranties do cover compressor labor. Compressor parts coverage may be obtained through the Compressor Parts Only contracts. There is no mark-up paid on compressor parts. Exclusive labor service. Only the de aler registered on the Labor Only or Parts & Labor optional warranty is eligible to repair the equipment. Services rendered by any other dealer/contractor will not be covered under this warranty. Any change in the registered dealer which must be authorized in advance in writing by your distributor can be initiated by Contract Administration. Dealer service warranty. The servicing dealer must provide a 60-day warranty on repair labor. Inspection and maintenance. Optional warranties do not cover inspection services or routine preventative maintenance. Equipment failure resulting from lack of maintenance will not be covered by these warranties. Service agreements should be offered to each optional warranty customer to cover these types of services. Limitations. Additional limitations and exclusions may apply. Contact your distributor or Contract Administration for complete details. Product eligibility. Contact your distributor for eligible models and pricing Contract Offerings 31 st Day Start 1-5 Year Labor* 1-10 Year Labor* 366 th Day Start 2-5 Year Labor* 2-10 Year Labor* 2-5 Year Parts Only 3 Phase Units Only 6 th Year Start 6-10 Year Parts Only 6-10 Year Parts Compressor Generators 4-5 Year Parts 4-5 Year 3-5 Year Labor Parts Only 3-5 Year 3-5 Year Parts & Labor Parts Only * Parts covered under Standard Warranty (10 years if properly registered, otherwise five years). Parts mark-up paid under Optional Warranty. 10

11 Labor Rate Plans Not only is Carrier s Optional Warranty Program simple, it also offers dealers outstanding allowances and terms. For example, dealers are not restricted to an assigned labor rate. You can choose from one of four labor reimbursement rates (see table). Warranty plans will be priced according to the reimbursement rate you select, so it s up to you to determine the type of plan that works best for you. Contact your distributor for pricing. Labor Rate Reimbursement Options Plan A Plan B Plan C Plan D $75/hr $90/hr $110/hr $130/hr Labor rates will be automatically adjusted for inflation at a rate of 5% every three years. Optional Warranty Labor Rate Plans 1,2 Coverage start date Labor plan Coverage types available 31 st day coverage start 366 th day coverage start Plan A - Plan B - Plan C - Plan D - Plan A - Plan B - Plan C - Plan D - $75/hr $90/hr $110/hr $130/ hr $75/hr $90/hr $110/hr $130/ hr 1-5 Year Labor* 2-5 Year Labor* 1-10 Year Labor* 2-10 Year Labor* 1 Plan types and labor rates apply to new contracts that cover labor costs and are sold after February 1, All contracts sold prior to this date will continue to be reimbursed at the previously established labor rate. 2 Drive-up and diagnostic time will be calculated based on the labor rate attached to the given contract and plan type assigned to it. Please contact your distributor for further details. * Parts covered under Standard Warranty (10 years if properly registered, otherwise five years). Parts mark-up paid under Labor Only Optional Warranty. Program Allowances 70% mark-up on parts covered under Labor Only and pre-existing parts & labor contracts up to a maximum of $100. 1/2 hour total drive-up time. 1/2 hour of diagnostic time (only for calls when a repair/replacement is made). Maximum allowable repair times and refrigerant costs as listed in Appendix B. Up to three accessories can be added to a system without additional cost. These accessories can be selected from Infinity Air Purifier, Electronic Air Cleaner, Humidifier, UV light, or strip heater. To determine what qualifies as a system, see Appendix A. 11

12 3. Program Policies Virtually all Carrier-branded equipment is eligible for coverage under the Optional Warranty Program. (You ll find a complete equipment eligibility list in Appendix A Eligible Equipment.) Here is a summary of the coverage policies you need to know. Equipment start-up date is defined as the date the unit or system is placed, piped, wired and operational with final wiring, thermostats and utility connections. General Guidelines Timing of sale. All coverage must be sold to the homeowner within 12 months of the start-up date of the covered equipment. Coverage period. The beginning and end dates of the coverage period for any optional warranty contract are based on the start-up date, even if the warranty is purchased at a later time. Example: If start-up date is 1/1/2010, then a 10 Year Labor contract starting on day 366 will have coverage starting 1/1/2011 and ending 1/1/2020. Coverage commencement date. Coverage for all new Labor contracts begins either 31 or 366 days after the start-up date, depending on the option chosen by the dealer. All claims prior to this date must be covered by the servicing dealer. Labor coverage. Labor Only contracts cover all costs associated with service hours. Included in this coverage are drive-up, diagnostic, labor time spent on a repair, service materials and refrigerant. No costs associated with parts are covered under a Labor Only contract. Compressor parts and compressor parts mark-up are not covered. Parts Only coverage. Parts Only warranty options are designed to cover specific parts and major components of the HVAC system. While not covering any labor costs, these warranties do cover parts cost. There is no allowance for parts mark-up under these contracts. These contracts offer coverage in years 6 through 10, if the homeowner fails to register for the enhanced standard warranty within the required time period. 12

13 What s Covered, What s Not What is Covered? All plans: Nearly all Carrier-branded residential equipment is eligible for coverage. See the equipment eligibility table in Appendix A for a complete list of the equipment covered. Contact your distributor for a listing of eligible model numbers and applicable pricing. Non-Carrier-branded equipment will not be covered. To qualify as a system purchase, all equipment (including accessories) must be Carrier-branded and must be installed at the same time. An independent coil may be used with a system; however, the coil will not be covered under this warranty program. Labor Only plans: Drive-up time (1/2 hour of labor) Diagnostic time (1/2 hour of labor) Labor hours associated with repair Refrigerant cost ($9/lb for Puron refrigerant, ($6/lb for R-22) Parts mark-up of 70%, not to exceed $100 Field service materials, not to exceed 5% of total labor charges, for claims involving refrigerant handling $50 handling fee for compressors covered under Standard Warranty Sales Tax Parts plans: Dealer s parts cost What is Not Covered? Identical part failures or problems occurring within 60 days of repair Inspection services Diagnostic-only calls Routine seasonal maintenance plugged filters, nozzles, system adjustments, thermostat adjustments, clean and checks Preventative maintenance changing out a part in anticipation of future failure Noise complaints not associated with any component failure Leak repairs due to loose valves, fittings, or line sets Failure due to corrosive conditions (rust, etc.) or other environmental factors Refrigerant-only calls topping off the unit Failures resulting from lack of maintenance, including but not limited to tightening valves, adjusting thermostats, cleaning equipment, etc. Failure not caused by equipment or part breakdown or malfunction DOA (Dead-On Arrival from the factory) claims Submitting multiple or duplicate claims for the same service call Overtime charges or after-hour charges Damage due to misapplication, abuse, improper installation, servicing, unauthorized alteration or improper operation Cost of more than one technician at the repair/job site Failure associated with inadequate or interrupted electrical service (blown fuses, open circuit breakers, shorted wires, etc.) Failure/damage due to an act of nature (earthquake, tornado, hurricane, flood, fire, etc.) Claims that are turned in later than 60 days after repair date Non-Carrier-branded equipment failures coils, fan coils, thermostats Incomplete or Work in Progress claims Tax on parts covered by Standard Warranty 13

14 4. Participating in the Program Participating in the Carrier Optional Warranty Program is easy. You simply need to register which you can do by contacting your distributor and executing the Dealer Participation Agreement and then begin creating and selling contracts. Just follow the simple steps outlined in this section. For Labor Only contracts, only the dealer registered on the warranty is eligible to repair the equipment. Changes must be authorized in advance and in writing by your distributor through a Dealer Transfer Form (see Appendix H). (Additional limitations and exclusions may apply.) Dealer Registration To qualify for the Optional Warranty Program, you must have your distributor s approval. Follow the three simple steps below. 1. Fill out the registration forms. Complete and sign the Dealer Participation Agreement* (Appendix D). 2. Send the forms to your distributor. Send the Dealer Participation Agreement* (Appendix D) to your distributor for processing. The distributor will review the agreement and determine if your company meets the minimum requirements to participate in the Optional Warranty Program. The distributor will send the Dealer Participation Agreement to Carrier for final approval. Participation Requirements Dealer-warranted coverage for the first 90 days following a warranty purchase after the original equipment sale. Agreement to participate in reasonable audit procedures at the discretion of Carrier Corporation to determine the validity of claims, and the agreement to allow Carrier Corporation to directly solicit customer satisfaction comments, if required. 3. Get program materials from your distributor. When you have successfully met the program requirements and Carrier Corporation has given final approval, your distributor will provide you with complete information and any materials you need to successfully sell optional warranties. * All participating dealers are required to have a signed copy of the Dealer Participation Agreement on file with Carrier. 14

15 Creating and Registering Contracts After qualifying for participation in the Carrier Optional Warranty Program, you may begin selling warranties to your customers. When you install an eligible unit, accessory, or system, register the equipment using either the online NOW system (see below) or by submitting a paper registration form (see page 16). Online Registration (NOW System) Registering contracts online is fast and easy. Just follow the steps below. (For a more detailed walkthrough, ask your distributor for training materials covering the NOW system.) 1. Log on to hvacpartners.com and select the Warranty tab. 2. Select the Warranty NOW link on the left side window. In the list of options, select Register A Contract and click on the link for Residential. 3. Click on the Create a New Residential Contract link at the top of the main window. 4. Select the button for Parts Only or Labor Only and enter the purchase date of the contract in mm/dd/yyyy format. For a shortcut, click on the calendar icon and click on the correct purchase date. This will auto-fill the purchase date field. Then click Next. 5. The Dealer and Distributor numbers will appear automatically based on the HVACpartner ID used to log in. If more than one dealer or distributor number is associated with that account, use the drop-down list to select the appropriate numbers. If they do not appear automatically, fill in the required fields. Choose the appropriate Plan Type and Start for this contract from the drop-down lists. 6. Fill in the Homeowner Address Details. All items marked with an asterisk are mandatory. If the homeowner s address and the equipment address are the same, check the appropriate box. If not, fill in the Equipment Address Details. You will notice that a contract number has automatically been generated in the upper right corner. Click Next. 7. Choose from System Components, Individual Components, or System/Individual Components by selecting the appropriate button. 8. Choose the appropriate HVAC component by selecting the corresponding button and click Next. 9. Choose the Coverage Type by selecting an option from the drop-down list. Select the Plan Type you would like from the drop-down menu. This option may not be available for all dealers. Please contact your distributor for more information. On Step 9, your labor rate will appear automatically if you have chosen to use a single rate for all contracts. If not, choose the labor rate that you would like to apply to this contract. 10. Enter an Install Date in mm/dd/yyyy format. For a shortcut, click on the calendar icon and click on the correct install date. This will auto-fill the install date field. If the system was installed more than a year before the contract start date, you need to submit an Inspection Report. See Inspection Reports on page Enter the first four digits of the model number (Example: 58MV) and the complete serial number for each component, and click Next. 12. Fill in the amount the customer actually paid for the contract, without dollar signs or commas (example: ) and click Next. 13. Review the Residential Contract Summary page to ensure coverage type, install date, purchase date, Dealer/Distributor numbers, homeowner and equipment details, and system components are fully correct. 14. Check the certification box and click Finish. You may wish to print the confirmation with the Contract Number for your records. After completing the registration process, let the homeowner know that the warranty has been registered with Carrier Corporation. The Warranty Certificate will be directly mailed to the homeowner by Contract Administration. 15

16 Paper Registration To register a warranty contract using a paper form, use the Warranty Registration Form (see Appendix G) and follow the steps below, making sure the information is complete, correct, and clearly printed or typed. Notifying the homeowner After completing the registration process, let the homeowner know that the warranty has been registered with Carrier Corporation. The Warranty Certificate will be directly mailed to the homeowner by Contract Administration. 1. Before you fill out the form, make sure you have the following information: Dealer and distributor ID numbers (available from your distributor; required to process registration) Date of warranty purchase Equipment owner s name, address, and phone number Complete model number(s), complete serial number(s) and start-up date of equipment Type of coverage selected Plan type and labor rate associated with the contract (only applies to Parts & Labor and Labor Only contracts) Dealer s name, address and phone number Note: List only one system per registration form 2. Complete the registration form, then separate the copies and distribute each one to the party listed on the front of the copy. When online or paper registration is complete, the equipment is registered and eligible for coverage under the Optional Warranty Program. If the equipment covered under this plan needs repair and the appropriate time period has passed (30/365 days), you should provide the appropriate parts and/or labor to the customer at no cost and submit a claim to Contract Administration for reimbursement (see Filing a Claim on page 17). Contract Registration Guidelines All contracts must be sold within one year from date of installation and must be registered within 60 days of sale of contract. Failure to do so may void the contract and subsequent claims. Contracts registered later than 60 days after the sale and not determined to be void will be billed based on the contract price prevalent at the time the contract is registered. Additionally, a $50 administrative and handling fee will be billed for such contracts. 16

17 Filing a Claim If an eligible product covered by one of the optional warranty plans needs to be repaired, handle it like any other service call. The only difference is that part (or all) of the bill will be paid by Carrier Corporation instead of the customer. Submit claims online or by sending in a paper Claim Form for Labor Only contracts, or a Parts Credit Claim Form for Parts Only contracts. Submitting a Claim Online (NOW System) For a more detailed explanation, ask your distributor for training materials on the NOW system. See page 18 for additional items that may be required to process your claim. 1. Log on to hvacpartners.com and select the Warranty tab. 2. Select the Warranty NOW link on the left side window, select File a Claim from the options list, and click on the link for Contract Claim. 3. Click on the File a New Claim link in the main window. 4. Enter the first four digits of the model number, then the complete serial number and the quantity in the appropriate spaces, and click Next. 5. Select the contract number for this claim from the drop-down box. The install date will appear automatically, based on what was entered when the contract was created. 6. Enter the failure date and the repair date in mm/dd/yyyy format. For a shortcut, click on the calendar icon and click on the correct failure or repair date. This will auto-fill the field. Click Next. Note: Claims must be submitted within 60 days of the repair date. 7. The dealer and customer information will appear automatically, based on what was entered when the contract was registered. Enter a description of the failure and what repair was made in the space marked Reason for Part Failure. Failure to enter a description in this box may cause the claim to be rejected by Contract Administration. Descriptions such as bad part or replaced part do not meet the criteria of a failure description and may be challenged. Click Next. 8. Indicate if this is a compressor or non-compressor repair by selecting the appropriate button. Fill in the required information about the replacement part and the defective part, including part and serial number for both. For a non-compressor repair, enter the dealer price of the part. All dates should be entered in the mm/dd/yyyy format. For a shortcut, use the calendar icon again and select the appropriate dates. Click Add Part Info. 9. The replaced parts will be summarized at the bottom of the page. Check the details to ensure they are correct. This information can be edited by clicking on the magnifying glass icon, or deleted by clicking on the trash can icon. Double-check the parts for accuracy. The system will indicate whether the defective part should be scrapped or returned in the bottom right box of the menu. Once you re ready to proceed, click Next. 10. If the claim includes labor, the next screen will record the labor claim information. Enter the number of labor hours (example: 3.5), the labor rate, the quantity of refrigerant used in pounds (example: 9.5), the compressor handling fee, if applicable, the field service materials, and tax amount. The drive-up fee will be calculated automatically based on your labor rate. All dollar values should be entered without commas or dollar signs (example: ). Finally, indicate whether this was a leak repair by selecting a response from the pull-down menu. Click Next. 11. Look over the labor claim summary to ensure it is accurate. After doing so, click Next. 12. Review the entire claim to ensure that the correct contract, model, and serial numbers have been entered, and that the customer and claim information is correct. 13. Finally, check the box certifying the information to be accurate and click Finish. You can also print the confirmation and claim number for your records. All claims submitted through NOW will be placed on hold for approval by Contract Administration. Carrier reserves the right to audit all claims to confirm validity, including contacting the homeowner. 17

18 Filing a Claim, cont d Submitting a Paper Claim To submit a claim for reimbursement with a paper form, use the Labor Claim Form (see Appendix F) or Parts Credit Claim Form (see Appendix E) and follow the steps below, making sure the information is complete, correct, and clearly printed or typed. Forms are also available from your distributor. 1. Fill out the Claim Form completely; a description of the work performed and parts replaced must be included in the bottom section of the form. 2. Separate the copies of the Claim Form and distribute them to the appropriate parties as instructed by your distributor. 3. Attach the service work-order to the original copy of the claim. 4. Submit the original copy of the Claim Form and the work-order within 60 days of the service work-order completion date. Remember, all claims for reimbursement online or paper must be submitted within 60 days of the repair date to be honored. Other Documentation Contract Administration may require additional documentation concerning a claim, including (but not limited to) invoices, the signed customer service ticket, parts receipt, a copy of the maintenance agreement, and an Authorization Form (see Appendix J) signed by the distributor service manager. As a result, dealers are expected to keep legible records of work performed and materials used. Requests for these documents may be random unless a prior claiming issue warrants further investigation. All additional documentation requests must be fulfilled within two weeks or the claim will be rejected. Claims that exceed $750 should include these documents automatically. Use of a non-carrier-branded part in an emergency is allowed, but must be claimed through a paper claim and include a copy of the customer signed service ticket for processing. Claim Validity While the vast majority of dealers are committed to integrity in their business operations, Carrier must protect homeowners and the company from Creative Claiming making inaccurate or falsified claims, a rare practice that is both unethical and illegal. As a result, Carrier reserves the right to perform reasonable auditing procedures on all claims including contacting the homeowner to confirm their validity. To ensure that your claims are processed efficiently and without complication, please make sure all claim forms and/or online data fields are complete and accurate before submitting them for reimbursement. 18

19 Claim Reimbursement Guidelines Reimbursements are based on the actual costs to the dealer rather than a list or master price. The following sections provide guidelines for Labor Only and Parts Only payment allowances. Labor Only Contracts Labor claims are paid at the rate specified by the plan type indicated on the contract. Drive-up time is 1/2 hour. No added labor will be awarded for excessive mileage. Diagnostic time is 1/2 hour. Overtime rates and/or charges for more than one technician at the repair site will not be covered. The maximum allowable repair times that can be claimed are listed in Appendix B. Claims that exceed the listed standard times will be adjusted to the allowable time by Contract Administration. All labor hours are paid at the rate specified by the plan type indicated on the contract. The reimbursement for any repair or replacement parts covered by a Carrier Service Manager s Bulletin (SMB) shall be governed by the SMB, which will take precedence over the optional warranty terms. Compressors covered by a Standard Warranty do not qualify for a parts mark-up, but do qualify for a $50 Compressor Handling Allowance. These replacement compressors must be obtained from your distributor to qualify. Parts will receive a mark-up of 70% not to exceed $100. Emergency, non-carrier-branded parts purchased for an eligible product will receive a mark-up of 50% not to exceed $100. Non-Carrier-branded parts may only be used in emergency situations where unacceptable delays would result from Carrier-branded parts being unavailable within a reasonable time frame. These parts must be claimed using a paper claim form and include a signed customer service ticket for processing. Puron refrigerant can be claimed at the rate of $9/lb and R-22 refrigerant can be claimed at the rate of $6/lb, both with the maximum allowable amount on any claim corresponding to the recommended system charge. Refrigerant costs higher than this will be adjusted by Contract Administration to the allowable amounts. Refrigerant claims should be made in the appropriate section of the Claim Form or NOW claiming system. Refrigerant claimed as field service material or included as a parts claim will not be honored by Contract Administration. Refrigerant handling time is included in the allowable labor schedule. 19

20 Filing a Claim, cont d Field service materials include only ancillary materials used during a repair, such as duct tape, wire, etc. Any field service material costs above 5% of the total labor charge may be rejected. DOA compressors are not eligible for warranty claims; reimbursement credit must be applied for through Contract Administration. Freight or handling charges will not be reimbursed. The maximum allowable repair times that can be claimed are listed in Appendix B. Claims that exceed the listed standard repair times will be adjusted to the allowable time by Contract Administration. All labor hours are paid at the rate specified by the plan type indicated on the contract. Claims requiring multiple part replacements will not result in cumulative hours awarded. Please select the longest repair time allowed for the parts replaced for use on these claims. The reimbursement for any repair or replacement parts covered by a Carrier Service Manager s Bulletin (SMB) shall be governed by the SMB, which will take precedence over the optional warranty terms. State and/or local sales tax on parts may be reimbursed where applicable. Parts Only Contracts All components repaired or replaced during a single service call should be submitted on the same claim form. The reimbursement for any repair or replacement parts covered by a Carrier Service Manager s Bulletin (SMB) shall be governed by the SMB, which will take precedence over the optional warranty terms. State and/or local sales tax on parts may be reimbursed where applicable. Carrier-supplied parts for use on eligible products can be claimed for reimbursement at the dealer s actual cost. DOA compressors are not eligible for warranty claims; reimbursement credit must be applied for through Contract Administration. Freight or handling charges will not be reimbursed. 20

21 Dealer Termination Carrier may, in its sole and absolute discretion, immediately terminate a dealer s participation in the Program at any time without prior written notice to the dealer if Carrier determines that either of the following has occurred: (a) the dealer files an inaccurate or falsified claim or otherwise engages in fraudulent or unethical behavior; or (b) the dealer files or is served with a petition of voluntary or involuntary bankruptcy, becomes insolvent, or otherwise is unable to continue its business operations. Carrier may, in its sole and absolute discretion, terminate a dealer s participation in the Program at any time, with or without cause, upon thirty (30)-days prior written notice to the dealer. Examples of acts or omissions that may result in dealer termination include, but are not limited to, the following: (a) the dealer has ceased to purchase Carrier Eligible Equipment and participate in distributor-offered service training programs for Carrier products; (b) the dealer s Assessment Score exceeds 175 for a period of six (6) consecutive months; or (c) the dealer is no longer able to provide the required service or equipment for optional warranty contracts. Transferring Contracts Transfers to a new dealer Optional warranties are contracts between Carrier and homeowners that have purchased Carrier products. Accordingly, in the event that circumstances require Carrier to terminate a dealer from the Program, Carrier reserves the right to assign all optional warranty contracts registered to such dealer to another dealer or contractor. The transfer request must be made in advance by the servicing distributor, through the use of a Dealer Transfer Form (see Appendix H), and approved by Contract Administration, who will assign another dealer to service the contracts. Following the transfer, the terminated dealer will be prohibited from submitting any further applications for optional warranty contracts or receiving further reimbursement of any kind from Carrier pursuant to the Program for services rendered after the reassignment. At any time, a request may be made by the homeowner for the transfer of the optional warranty contract to an authorized dealer of the homeowner s choice. This transfer will be initiated by the servicing distributor in the form of written notice to all parties involved. Transfer of coverage will become effective thirty (30) days from the date of written notice. Transfers to a new homeowner All Carrier optional warranty contracts can be transferred to a new homeowner with no fee, as long as the original equipment remains in the original location and application. (See Appendix I for the Homeowner Transfer Form.) 21

22 5. Program Evaluation Tools Optional warranties are good for your customers and good for your business especially if your warranty service operations are profitable. Now the Carrier Optional Warranty Program includes a new tool you can use to assess your performance and help you manage your business more efficiently. Sample Assessment Score If all of the contracts a dealer has sold are assigned an expected claim total of $2000, and the sum of actual claims made is $1500, then the dealer s Assessment Score is 75 (1500/2000 x100). Assessment Score The Assessment Score is a standard benchmarking tool established to help you evaluate and manage your optional warranty business; it compares actual claims filed on your open contracts to the amount of expected claims for these contracts. Expected claims are calculated with consideration given to the type, price and age of each contract and all administrative and support costs associated with a claim (see Sample Assessment Score). Frequency of claims, number of remaining years on the contract, and cost of claims are also considered. Component failures or change-outs driven by a Service Manager s Bulletin will be handled outside of the Optional Warranty Program and will not affect individual Assessment Scores. What the Score Means Intended to be a uniform measure of how a dealership is managing its optional warranty business, the Assessment Score reflects how many contracts a dealer sells, the number of service calls administered, and the value of the claims filed. A low Assessment Score is a potential indication of many positive characteristics, such as well trained technicians, quality sales techniques, and a well managed business in general. A high Assessment Score may indicate potential issues, such as the need for better sales and technical training, or the need for adherence to policy or other similar issues. Assessment Score Guidelines Score Range Evaluation A B C D 176+ F Typically, 95% of dealers fall in the A to C range and only 2% receive a grade of F and require corrective action. A dealer should strive to maintain a score of less than

23 How the Score is Used The Assessment Score will be calculated for each dealer at the beginning of each year, based on prior claiming history. Once established, the score will be updated and reported every quarter. An Assessment Score of 175 or greater will prompt immediate corrective action by the program until the dealer s score returns to an acceptable level and the reason for the score is addressed. Corrective action may include additional training, enrolling the dealer in a 100% parts return program, removal from the online NOW claiming system and other initiatives. If the dealer s score does not drop below 175 within six months, the dealer may become ineligible for the Optional Warranty Program. Warranty Program Reporting Monthly business reports will be calculated quarterly and released through distribution to help you evaluate and manage your optional warranty business. These reports will include current and prior year performance and track sales based on the number of contracts sold. These quarterly scores will be an indicator of your performance through the year. Quarterly reports are intended to help dealers track their performance and address any issues as early as possible. How to improve an Assessment Score Encourage regular technical training for your installation and service technicians. Properly diagnose each repair/replace issue. Reduce claiming activity driven by factors stated above. Monitor quarterly Assessment Score reports and address issues early before they spiral out of control. Sell more optional warranty contracts. Assuming claiming issues are related to a handful of problem installations, this will give you a broader base over which to spread your actual claims. Talk with your Distributor Service Manager to develop a complete action plan and review other suggestions. Scores for new dealers New dealers or dealers who have not sold Carrier Optional Warranty contracts in the past will be given a default Assessment Score of 100. If the dealer has 19 or fewer open optional warranty contracts when Assessment Scores are next reported (at the end of every quarter) the default score of 100 will remain. When a dealer has 20 or more open optional warranty contracts at the time when Assessment Scores are established, the company s claiming history will be considered and an actual Assessment Score will be awarded. 23

24 Appendix Contact Information All documents should be sent directly to Contract Administration at the following location: Carrier Corporation Contract Administration, TR-18S P.O. Box 4808 Syracuse, NY Phone: (866) Fax: (860)

25 Appendix A - Eligible Equipment Entire Heating and Cooling Systems* To qualify for system purchase, all equipment (except coils+) must be manufactured by Carrier, and all coils must be ARI Certified Matching through Carrier. A thermostat/control must be paired with one of the components listed below. SS A/C and ARI Certified Matching Fan Coil or Furnace Coil SS A/C and Furnace (An independent coil can be used with this combination, however, the coil will not be covered.) SS A/C, Furnace, and ARI Certified Matching Furnace Coil SS HP and ARI Certified Matching Fan Coil or Furnace Coil SS HP, Furnace, and ARI Certified Matching Furnace Coil 0-5 Ton Packaged A/C 0-5 Ton Packaged HP Gas/Electric Packaged Unit HYBRID HEAT Dual Fuel Packaged Unit * Excludes compressor/heat exchanger parts; includes condenser coil on SS/packaged unit. + A third party coil may be used, but will not be covered by this program. Cooling and Heating Equipment SS A/C SS HP Gas/Oil Furnace Boiler * Excludes compressor/heat exchanger parts; includes condenser coil on SS/packaged unit. Zoning Products and Controls Infinity Control (NIM, SAM included) Infinity Zoning Control (NIM, SAM, control board, dampers included) Performance Series Comfort Zone II (dampers included) Comfort Series Three-Zone (dampers included) Carrier Programmable Thermostat (covered with a system) Carrier Non-Programmable Thermostat (covered with a system) Air Treatment Products Infinity Air Purifier (filters not included) Carrier Electronic Air Cleaner (filters not included) Carrier Humidifier (pads not included) Carrier HRV or ERV UV lights (bulb replacement not included) Compressor Compressor for SS A/C, PAC AC, or Gas/Electric PAC Compressor for SS HP, PAC HP, or HYBRID HEAT Dual Fuel PAC Generators Air-Cooled Generators (includes transfer switch) Liquid-Cooled Generators (includes transfer switch) 25

26 Appendix B - Allowable Labor Hours+ and Refrigerant Costs Allowances $ Puron refrigerant per lb. $9 R-22 per lb. $6 HRS Drive-up 0.5 Diagnostic 0.5 A/C and Heat Pump Accumulator* 3.0 Compressor* 4.0 Condenser Coil* 4.0 Condenser Fan Motor 1.0 Contactor 0.5 Defrost Board 0.5 Dual Capacitor 0.5 TXV (located in O/D unit) 2.0 Main Control Board 0.5 Pressure Switch* 2.5 Reversing Valve* 3.5 Service Valve* 3.0 Soft Start 0.5 Solenoid Valve 1.5 Start Capacitor & Relay 0.5 Strainer* 2.0 Thermistor 0.5 Time Delay Relay 0.5 All Other Components 0.5 Furnace Coil/Fan Coil Check-Flo-Rate/Piston* 1.5 Blower Motor 1.0 Blower Motor Assembly 0.5 Blower Wheel 1.0 Circuit Board: var. sp 1.5 Circuit Board: others 1.0 Coil Change Out* 3.0 Coil Leak Repair* 2.5 Drain Pan 3.0 Solenoid* 1.5 Strainer* 1.5 TXV* 1.5 All Other Components 0.5 Oil Furnace Beckett Burner Assembly 1.0 Drum Heat Exchanger 4.0 Igniter Electrodes 0.5 Oil Nozzle 0.5 Oil Pump 1.0 All Other Components 0.5 HRS Gas Furnace Blower Assembly 0.5 Blower Motor 1.0 Blower Wheel 1.0 Capacitors 0.5 Circuit Board: var. sp 1.5 Circuit Board: others 1.0 Collector Box 1.5 Coupling Box: multi poise 3.5 Coupling Box: others 1.5 Draft Safeguard Switch 0.5 Flame Sensor 0.5 Gas Valve 1.0 Heat Exchanger-Primary 4.5 Heat Exchanger-Secondary 2.5 Hot Surface Igniter 0.5 Igniter Controls 0.5 Inducer Motor 1.0 Inducer Motor Kit 0.5 Inducer Wheel 0.5 Limit Switch 0.5 Pilot Assembly 1.0 Pressure Switch 1.0 Rollout Switch 0.5 Transformer 0.5 Wiring Harness 1.0 All other components 0.5 IAQ/Controls EAC Component 0.5 Humidifier Component 0.5 Zone Control/Board 1.0 Zone Damper 1.0 Zone Component 0.5 Vent Perfect 0.5 Strip Heater 0.5 Thermostat 1.0 All other components 0.5 Generators Engine Long Block 5.0 Rotor/Stator Assembly 4.0 Cylinder Heads 2.0 Fuel Regulator 1.0 All Other Components 0.5 HRS Small PAC 0-5 Ton Accumulator* 3.0 Check-Flo-Rate/Piston* 2.0 Blower Assembly 1.0 Circuit Board 1.0 Collector Box 1.0 Compressor* 4.0 Contactors 0.5 Coupling Box 1.0 Crankcase Heater 0.5 Dual Capacitor 0.5 Economizer Motor 0.5 Evaporator/Condenser Coil* 4.0 Flame Sensor/Igniter 0.5 Gas Valve 0.5 Heat Exchanger Assembly 5.0 IGC, HP, ICM Circuit Board 1.0 Igniter Control Pack 0.5 Inducer Motor Kit 0.5 Limit Switch 0.5 Low-Ambient Controller 0.5 Outdoor Motor/Fan 0.5 Pilot Assembly 0.5 Pressure Switch (cooling)* 1.5 Pressure Switch (heating)* 0.5 Reversing Valve* 3.5 Rigging On Rooftop Units 2.0 Rollout Switch/Temp 0.5 Act Switch Start Capacitor and Relay 0.5 Strainer* 2.0 Time Delay Relay 0.5 Transformer 0.5 Wiring Harness 0.5 All Other Components 0.5 Boiler Aquastat 0.5 Batteries/Heat Exchanger 4.0 Push Nipples 4.0 Water Pump 1.0 All other components Claims requiring multiple part replacements will not result in cumulative hours awarded. Please select the longest repair time allowed for the parts replaced for use on these claims, each additional part replaced will be awarded one-half hour. * Times include refrigerant evac/recharge. Call prior to repair for approval for liquid cooled model. 26

27 Appendix C - Recommended Replacement Parts for Vehicle and Dealer Inventory Furnaces 1/3 HP PSC Motor 1/2 HP PSC Motor 3/4 HP PSC Motor 1 HP PSC Motor 740 Pilot 24 Volt Transformer Capacitors Circuit Boards (Main and Inducer) Flame Sensor High Temperature RTV Silicone Hot Surface Igniter Igniter Control Inducer Motor and/or Inducer Motor Kit Limit Switches Furnace Coils and Fan Coils 1 to 5 Ton TXVs AccuRater Body Assorted Pistons Blower Motors A/Cs and HPs Condensing Fan Motor Contactors Defrost Timer Dual Capacitors Hard Start Kit High-/Low-Pressure Switches Main Control Boards Outdoor Pistons Service Valves Soft Start Kit Solenoid Valves Time Delay Relay Oil Furnaces Igniter Electrodes Oil Pump Boilers Aquastat Low Water Cut-Offs Water Pump 27

28 Appendix D - Dealer Participation Agreement 28

29 Appendix E - Parts Credit Claim Form APPLICATION MUST BE SUBMITTED WITHIN 60 DAYS OF REPAIR SERVICER SERVICER ID DISTRIBUTOR DISTRIBUTOR ID STREET CITY STATE SELLER CUSTOMER INFORMATION SERVICER DISTRIBUTOR CUSTOMER STREET CITY ZIP SLS SLIP NO. PHONE STATE ZIP PHONE BASE UNIT MODEL OR PRODUCT NUMBER CLAIM X REF. FAILED REPLACEMENT FAILED REPLACEMENT FAILED REPLACEMENT FAILED REPLACEMENT FAILED REPLACEMENT I CERTIFY THAT THIS IS A TRUE AND COMPLETE STATEMENT TEMENT OF WORK CARRIED OUT. DEALER SIGN QTY PART NUMBER (NOT VENDOR NUMBER) PURCHASE DATE BASE UNIT SERIAL NO. SMB/FACTORY PROGRAMS: ROOF TOP HOURS PER HOUR % TOTAL LABOR POUNDS REFRIG DIST. REF. 0 STOCK / INVENTORY 4 OUT OF WTY EXCHANGE 1 1ST YR WTY 5 OPTIONAL CONTRACT* 2 EXTENDED WTY 6 SALVAGE COMPRESSOR 3 SERVICE PART 7 COMPETITIVE EXCHANGE * INDICATE OPTIONAL CONTRACT NO. HERE QTY. UNIT INSTALLED / / DIST. CREDIT WARRANTY RANTY STATUS TU DATE: FAILED / / COMPRESSOR SERIAL NUMBER SAMPLE PLE LABOR & FIELD PURCHASE MATERIAL SHOULD NOT BE COMPLETED UNLESS AUTHORIZED BY A FACTORY PROGRAM. ASK YOUR DISTRIBUTOR REPAIRED / / INSTALLED MO DAY YR / / / / / / / / / / / / / / / / / / / / $ PER POUND TOTAL REF. COST FLD SERV MATL'S TOTAL CIRCLE REPAIR TYPE: (C) (L) (M) (X) (U) DISTRIBUTOR APPROVAL BY: DATE: FACTORY FACTORY APPROVAL BY: DATE: COMMENTS: 29

30 Appendix F - Labor Only Claim Form Labor Only 30

31 Labor Only Claim Form Example Labor Only 31

32 Appendix G - Warranty Registration Form OPTIONAL WARRANTY 32

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