Historically, the extended warranty industry has been regarded as high risk as it has a high risk of loss exposure for the sponsor bank and credit card processor.
Extended Warranty Businesses are Considered High Risk
When selling an extended warranty via a credit card, the customer can dispute the charge during 6 months. As a rule, not everything is covered by your extended warranty. When a customer buys a warranty and finds out it doesn’t cover his/her specific situation, he/she usually gets annoyed and disputes a chargeback. That’s why the extended warranty businesses are classified as high risk.
Not every high risk merchant service provider accepts extended warranty businesses. Voted the #1 high risk merchant account provider in the US, emerchantbroker.com offers a secure and low-cost extended warranty merchant account to merchants of any type and size. EMB aims to provide comprehensive and affordable extended warranty merchant account services for its clients running a warranty business.
EMB’s goal is to stay ahead of its competitors and guarantee the best extended warranty merchant account services for your warranty business, both for car and other automotive warranties, home and appliances, electronics and travel, vacation and other businesses related to extended warranty.
Extended Warranty Industry Categories
If you’re an extended warranty business that needs to complete a credit card processing application, a specific SIC code and NAICS code for the credit card processor should be designated so to classify the business.
Extended warranty businesses generally fall into one of the below-mentioned SIC codes:
- 6351: Surety Insurance: Establishments primarily involved in underwriting financial responsibility insurance
- 6399: Other Insurance Carriers (Not Elsewhere Classified): Often refers to extended warranty merchants across all industries.
- 7389: Business Services (Not Elsewhere Classified):A catch-all for business services that do not neatly fit into another SIC category
Extended warranty businesses generally use one of the below-mentioned NAICS codes:
- 52413002: Reinsurance Carriers: Primarily for extended warranty and other reinsurance providers, and more
- 44131: Automotive Parts and Accessories: A catch-all category for a wide range of other car-related businesses, including auto extended warranties
- 524128: Other Direct Insurance (Life, Health, and Medical aren’t included) Carriers: For other extended warranty providers
Emerchantbroker.com understands that your extended warranty business model operates with an above average chargeback ratio. EMB offers tools to help you reduce chargebacks and keep your ratio at an acceptable percentage. EMB’s ChargeBack Shield Program can help merchants operating in high chargeback industries such as automotive warranties and other high ticket items.
EMB is rated A+ by the BBB and A by Card Payment Options. EMB is one named one of Inc. 500’s Fastest Growing Companies of 2016.