Reinsurance Conversations at NADA: How Dealers Separate Structure From Sales Pitch
- Michael Aufmuth
- Jan 31
- 5 min read
NADA is where conversations about reinsurance get louder.
Every year, dealers hear the same refrains:
“You should already be in reinsurance.”
“Our structure is best in the market.”
“This is how sophisticated dealers do it.”
For many dealers, those conversations are familiar—and often frustrating. Not because reinsurance isn’t valuable, but because it’s rarely explained in a way that allows for true comparison.
This site exists for one reason: to help dealers understand reinsurance clearly, without pressure, hype, or incomplete information.
As NADA approaches, here’s how dealers can cut through the noise and evaluate reinsurance programs based on structure—not salesmanship.
Reinsurance Isn’t the Question. Structure Is.
Most dealers attending NADA aren’t asking whether reinsurance works.
They’re asking:
Is my current structure optimized?
Am I paying more than I should?
Do I actually understand where the money goes?
Would I make the same decision again today?
Those are reasonable questions—and they rarely get clear answers on the show floor.
Reinsurance success isn’t determined by the concept. It’s determined by how the program is built, how fees are layered, and how risk is managed over time.
Transparency Is the First Test
The simplest way to evaluate any reinsurance discussion at NADA is to start with transparency.
Dealers should be able to clearly see:
administrative fees,
ceding percentages,
claims handling costs,
reserve requirements,
and long-term profit mechanics.
If these details are described vaguely, minimized, or deferred to “later,” that’s a signal—not a coincidence.
Transparent programs are explainable.
Opaque programs rely on trust without verification.
This is why comparison tools matter. Without them, dealers are forced to evaluate programs based on confidence rather than clarity.
Ownership Without Visibility Creates Risk
A common theme heard at NADA is ownership:
“You own your own reinsurance company.”
“You control your own risk.”
“You’re building wealth.”
Ownership alone doesn’t guarantee benefit.
True ownership includes visibility and control—not just on paper, but in practice. Dealers should understand:
how much premium is retained versus ceded,
how claims trends affect reserves,
how profits are accessed and when,
and how flexible the structure is over time.
Programs that work well only under perfect conditions introduce long-term risk. Dealers should be able to stress-test assumptions before committing.
Claims and Chargebacks Reveal the Real Economics
One of the most overlooked aspects of reinsurance discussions is what happens after the sale.
Dealers should understand:
how cancellations are handled,
who funds refunds,
how long chargeback exposure exists,
and how claims are adjudicated.
These factors directly impact both profitability and customer experience.
A well-structured program balances risk protection for the dealership with support for the end customer. That balance is rarely visible in a brochure—but it becomes clear when reviewing the underlying mechanics.
Reinsurance Should Be Evaluated Over Years, Not Months
NADA often compresses decision-making into short conversations.
Reinsurance does not operate on that timeline.
Its impact is measured across:
multiple sales cycles,
changing market conditions,
claims maturity,
and long-term capital accumulation.
Dealers evaluating reinsurance should look beyond introductory numbers and understand how costs and returns evolve over time.
Side-by-side modeling isn’t a luxury—it’s a necessity.
Comparison Is Not Disloyalty
Many dealers hesitate to compare programs because they feel it signals dissatisfaction.
In reality, comparison is due diligence.
Reviewing a structure doesn’t mean abandoning it. Often, it confirms that a dealer made the right choice. In other cases, it reveals areas that can be improved or optimized.
Dealer-reinsurance.com exists to support that process—without pushing outcomes.
Why Tools Matter More Than Opinions
At NADA, opinions are plentiful.
What’s often missing are tools.
Dealers benefit most when they can:
map fees side by side,
see cumulative costs over time,
identify assumptions in each structure,
and evaluate risk exposure objectively.
That’s why this site offers practical resources like the Reinsurance Cost Worksheet—designed to replace guesswork with clarity.
Moving From Conversation to Understanding
The goal of reinsurance education isn’t to persuade.
It’s to inform.
Dealers who understand their structure make better decisions—whether they stay the course or make changes.
For those seeking deeper, transparent analysis and side-by-side evaluation, Elite FI Partners works with dealers to review existing programs, explain tradeoffs, and align reinsurance strategies with long-term dealership goals.
The key difference is approach: education first, decisions second.
Before NADA Ends
Before the show wraps up, dealers should walk away with more than brochures and business cards. They should walk away with:
clearer questions,
better understanding,
and fewer assumptions.
Reinsurance isn’t about choosing the loudest voice on the floor.
It’s about choosing clarity that holds up long after the show ends.
If you want to evaluate what you’re hearing at NADA in a structured, objective way, download the Reinsurance Cost Worksheet here on dealer-reinsurance.com and start with the facts.
Clarity is the most valuable takeaway you can bring home.
FAQ Section for dealer-reinsurance.com
What should I ask a reinsurance vendor at NADA?
Ask for a clear breakdown of the full cost structure: administrative fees, ceding fees, claims handling costs, reserve assumptions, and how profits are calculated and distributed over time.
How can I tell if a reinsurance program is truly transparent?
A transparent program can be explained in plain language and supported with documentation. You should be able to see where every dollar goes, what’s retained, what’s ceded, and how claims impact results—without “we’ll cover that later.”
Does comparing reinsurance programs mean I need to switch providers?
No. Comparison is due diligence. Many dealers compare programs to validate that their current structure still makes sense, or to identify small improvements without disrupting existing relationships.
What’s the difference between reinsurance as a concept and reinsurance structure?
The concept is the idea of retaining risk and participating in underwriting profit. The structure is how it’s actually implemented—fees, reserve requirements, premium flow, claims assumptions, and timing of profit realization. Structure determines results.
Why do reinsurance fees matter so much over time?
Because small percentage differences compound. A fee that looks “minor” in year one can meaningfully reduce retained premium and long-term dealer wealth when applied across years of contract volume.
What role do claims and cancellations play in reinsurance performance?
Claims and cancellations determine how much risk is retained and how reserves mature. Dealers should understand who funds refunds, how long exposure lasts, and how claims are adjudicated—these factors affect both profitability and customer experience.
Is there a simple way to compare reinsurance programs side by side?
Yes. The Reinsurance Cost Worksheet on dealer-reinsurance.com is designed to help you capture and compare fees, assumptions, and structure in a consistent format so you can evaluate programs objectively.
Can Elite FI Partners help me review my current reinsurance structure?
Yes. Dealers who want a deeper side-by-side review can visit elitefipartners.com to learn how Elite FI Partners helps dealers analyze their current program versus alternatives with a transparency-first approach.
Comments