New research by Autoguard Warranties shows a 32% increase in the number of consumers buying warranties online over the last 12 months, a trend which will inevitably take revenue from dealers.

Robert Dockerill, director of Autoguard, says savvy consumers are now shopping around for warranties as they do with insurance.

"Dealers are losing money on the up-sell of warranties, which can amount to 10-15% of the profit of the vehicle,” he said. "However, some dealers have become more sophisticated in the way they up-sell using merchandising and video in the showroom.”

One such success story is The Diesel Car Company, which has been selling Autoguard’s insurance-based warranty and GAP/RTI products for just over a year.

General manager Rob Longman commented: "Since working with Autoguard Warranties we have uplifted our warranty sales by 75%.

“This is due to a combination of increased demand for warranties, a better product range supported by excellent claims handling, and highly trained staff.

"We have also introduced merchandising in and outside the dealership which communicates the features and benefits.”