Allied Solutions’ Risk & Recovery Director Sergio Moreira reflects on helpful ways to build a successful risk management strategy in 2020. Sergio Moreira, Director of Risk & Recovery at Allied Solutions, is being recognized this year at Used Car Week as a 40 Under 40 industry leader. 

Sergio Moreira, Director of Risk & Recovery, Allied Solutions

At Allied Solutions, Moreira manages Allied’s risk and recovery products, including RepoPlus and EZ Claim. These products assist with insurance monitoring and insurance carrier recoveries. In 2018, Allied recovered $38.1 million with RepoPlus, and successfully handled over 14,000 claims.

2020 stands to bring its own sets of opportunities and challenges for lenders. In an October webinar with Auto Remarketing, Sergio brought specific attention to one of these anticipated challenges: changing compliance regulations to auxiliary products. Other 2020 challenges for lenders include rising damage costs and total loss claims, repossession management, peer to peer rental claims, and natural catastrophes

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Many of these changes are emerging as consumers continue to face increasing costs for both insurance premiums and vehicle prices. Consumer behavior tends to gravitate toward an affordable monthly payment, which usually translates to a longer loan term. This means car buyers are paying more for their car over a longer time period, which, in part, is fueling a rising need for additional products and services that help protect the collateral from the increased risk of damage that comes with time.

These challenges influence an organization’s risk management and recovery strategy. Recoveries can be complicated due to rules and regulations that vary by location. Moreira states, “Every state has different processes that regulators look at, so it’s important for lenders to stay up to date on these changes. We have to work together.”

However, despite ongoing market challenges, opportunities remain for lenders in 2020.

With a risk strategy in place and investment in the right products, lenders can feel prepared and secure in handling the unexpected.

Leverage your data: Data can help identify strengths and weakness with your current strategy. For example, ZIP code and mapping data gives you a sense of exposure, data from insurance tracking technology provides early indicators of default or loss, notification data share inadequate insurance on your collateral and self-provided account holder data helps your institution communicate with consumers to avoid loan and mortgage defaults.

Collaborate with providers: Changing regulations don’t just impact lenders. Make sure to engage with all stakeholders, and review all stakeholder obligations for better collaboration. Ask questions, document the process and establish a communication strategy with internal and external stakeholders to help improve your aftermarket processes.

Reevaluate your risk management processes: It’s important to review your ongoing strategy, and establish what’s working and what could be improved. This includes, operation timelines, communication processes and status updates to help reevaluate if and where data is being lost.

With a risk strategy in place and investment in the right products, lenders can feel prepared and secure in handling the unexpected. Different products provide different functions to help protect your consumers and keep business operations running smoothly. Moreira shares, “It’s imperative to ensure that your consumers are made whole under your governing law. As we look ahead to 2020, ensure that following up with the end consumer is top of mind.”

Let’s continue the conversation.

Join Allied Solutions and DRN on Wednesday, November 13th from 7:00-8:30 A.M. for the 3rd Annual Peer-to-Peer Breakfast at Used Car Week, a creditor-only roundtable where lenders control the conversation and share topical concerns, questions, and solutions.  Breakfast is included. RSVP here!

About Allied Solutions

Allied Solutions, LLC is one of the largest providers of insurance, lending, and marketing products to financial institutions in the US. Allied Solutions uses technology based products and services customized to meet the needs of 4,000 clients along with a portfolio of innovative products and services from a wide variety of providers. Allied Solutions maintains over 16 regional offices and service centers around the country and is a subsidiary of Securian Financial Group, Inc.