In today’s rapidly evolving consumer electronics landscape, safety and innovation are paramount. We spoke with Michael Frosch, President of Personal Safeguards Group, LLC (PSG), a leading firm specializing in Service Contracts, Limited Warranties, and Specialty Insurance. PSG supports manufacturers (OEMs), marketers, retailers, dealers, and solution providers across multiple industry verticals.
With his extensive expertise and visionary leadership, Michael offers invaluable insights into the industry trends and the critical role of safety and security in consumer electronics. In this exclusive interview, he shares his perspectives on the future of personal safeguards and how PSG is setting new standards for those striving to meet the growing demands of tech-savvy consumers.
TWICE: Can you tell us about your background and how you got involved with Personal Safeguards?
Michael Frosch: I have been engaged in the Service Contract industry since the early founding of independent programs in the late 1980s, starting with a company named IDS out of St. Louis. IDS was one of the industry’s first consumer products service contract providers, and everything was new then. There weren’t any state regulatory frameworks, tech platforms for claims management, actuarial or underwriting data, or anything else. The national retailers were Sears and Montgomery Ward; the rest were regional players.
I spent the 2000s at The Warranty Group, leaving in 2013 after becoming global president and CEO of all business lines. When I left TWG in 2013, it was clear that the industry needed more innovation in program design, and an opportunity existed to work to help retailers, OEMs, and dealers build programs with enhanced economics and better customer service. I formed the Personal Safeguards Group in 2013 to address these opportunities. I began assembling an incredible network of industry participants and content to fill every need a company would have in building a service contract program.
TWICE: Can you share some key career milestones that led to your current position?
Michael Frosch: Personal Safeguards Group is the culmination of decades of experience in every avenue of the service contract space. It ties together the entrepreneurial elements I participated in, from the industry’s founding to a multi-billion-dollar industry maturing in regulatory and compliance, technology platforms, underwriting, and product expansion.
TWICE: What are some of the biggest challenges facing the extended warranty industry today?
Michael Frosch: I don’t think the industry is facing any significant challenges; rather, it is facing changes. Historically, a seller would work with a third party and take a commission off the sale. The third-party dealt with everything else, including the customer experience. This can lead to a lack of alignment since the seller wants to ensure the customer experience is 5-star, and the third party is concerned with administration expenses or claim payments. Today, sellers realize that options exist to own their service contract program, retain the customer experience, retain the underwriting profit, and only outsource elements that are logical, such as the regulated areas.
TWICE: How have consumer demands and behaviors changed in the extended warranty market over the past few years?
Michael Frosch: Shopping behaviors have changed as the retail side has moved to a heavy self-service model, and many transactions are now online. Customers are motivated by better programs with replacement coverage that includes accidental damage and an experience designed to drive customer satisfaction.
What sets Personal Safeguards apart from other companies in the extended warranty sector?
- Personal Safeguards Group (PSG) designs programs from the retailer, OEM, or seller’s perspective.
- PSG doesn’t have the embedded conflict of many third-party providers.
- PSG doesn’t sell administration services like traditional third parties and instead helps clients understand their options for outsourcing or insourcing.
- PSG doesn’t try to keep any of the client’s underwriting profit; PSG helps clients find the right program with the right carriers or providers to maximize income.
- PSG utilizes a wide network of technology providers, compliance and regulatory experts, tax experts, and actuarial experts to bring options to its clients to build a better program.
- Instead of using the same off-the-shelf program that gets funneled into a massive call center with dozens of other clients, PSG helps clients offer a better program that is aligned with the sellers’ objectives related to customer experience and profitability.
TWICE: How do you see the role of technology evolving in the personal safeguards space?
Michael Frosch: Advancements in technology are one of the drivers for companies taking control of their service contract programs. If a company sells online, they can easily integrate a service contract program into the shopping cart and use a simple tool for future claim administration. Especially for programs that sell replacement items, there is no need to pay an extra 25-40% to administer something with low frequencies and where the consumer receives a replacement item or cash voucher. In so many cases, the seller is doing the work and handing a file to a third party, who then charges a significant fee to hand the file to a carrier.
TWICE: Can you discuss any partnerships or collaborations that have been significant for Personal Safeguards?
Michael Frosch: Personal Safeguards Group has spent the last decade building partnerships with industry participants in every aspect of the service contract space. PSG has relationships with dozens of leading companies, including insurance carriers, technology platforms, compliance and regulatory experts, tax experts, repair and administration networks and providers, and many other areas. There is no one-size-fits-all at PSG, each client’s needs are measured against who is the right provider of the various elements of a solution. One insurance carrier may offer greater value in one type of program, one compliance expert may fit better in one program type, or one technology platform may be a better fit depending on product and distribution.
TWICE: What motivates you in your work and keeps you passionate about the industry?
Michael Frosch: The industry continues to offer interesting opportunities as new companies enter the space or as existing companies look for better models. PSG has seen a wave of insure-techs enter the space, direct-to-consumer product sellers start taking programs in-house after failed customer experiences via third parties, and new product designs and structures are making it easier for sellers to take control of their program.
TWICE: What are your thoughts on the future of the extended warranty industry, particularly regarding personal safeguard products?
Michael Frosch: The service contract industry will continue to thrive as new channels to buy products expand and new technology is embedded in everything we buy, from refrigerators to thermostats to home alarm systems to streaming devices.
TWICE: How do you foresee Personal Safeguards evolving over the next five to ten years?
Michael Frosch: PSG will continue to be an advocate for the sellers of products to ensure they have the most efficient and customer-focused programs possible. The lifetime value of a consumer is just a sound byte to some companies, but others see how a proper service contract program can enhance that value with a multiplying effect.
TWICE: Do you want to share anything about Personal Safeguards that we haven’t covered?
Michael Frosch: There are so many advantages to working with PSG that we could go on forever, but I would reiterate that PSG exists to support the seller of products and services and brings an agnostic approach to the process.
TWICE: How can people stay updated with the latest news and developments from Personal Safeguards?
Michael Frosch: Please go to our website at https://personalsafeguardsgroup.com/
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