On a 12-month warranty period based on a one in four claims ratio, a dealer generates around £235 on each claim and a further £140 on a driver getting their car serviced at the dealership.

Research by insurance company MB&G found that the two transactions generated around £185 in profit for the dealer and also provided the basis for an on-going relationship with the customer. “Dealers should focus on selling any value added package that encourages regular communication between them and the customer and that gives them a reason to come back again,” said Kevin Pearce, MB&G's operations director. “Too many dealers are looking for a quick profit fix and choose to sell items that only give a one-off benefit to their bottom line.”