Illinois Warranty Reimbursement
Illinois Dealers: Your State Law Guarantees Higher Warranty Rates
815 ILCS 710/6 · 22-32% typical uplift
Illinois has some of the strongest warranty reimbursement laws in the country. Don't leave money on the table.
Illinois Warranty Reimbursement Law
Illinois New Vehicle Dealer Act requires retail-rate reimbursement and includes a 1.5x multiplier provision for qualifying submissions. One of the strongest state laws.
815 ILCS 710/6
State Tier
strong
Submission Deadline
30-day submission window
OEM Response Window
30 days — 1.5x multiplier may apply
What This Means for Your Dealership
Illinois has arguably the strongest warranty reimbursement law in the nation. The statute is crystal clear: manufacturers must pay dealers no less than what a retail customer pays for the same work — same rate, same time. This applies to warranty repairs, recall work, and stop-sale repairs alike.
What truly sets Illinois apart is the potential 1.5x multiplier penalty. If a manufacturer fails to comply with the reimbursement requirements, dealers may be entitled to 1.5 times the amount owed. This creates a powerful financial incentive for OEMs to approve legitimate rate increase requests promptly.
Illinois law also extends protection beyond just warranty work to include recall and stop-sale repairs. Many dealers don't realize these repair types are also subject to retail-rate reimbursement under Illinois law, meaning the total recovery opportunity is even larger than the warranty-only number.
Key Provisions
- Manufacturers must pay dealers no less than what retail customers pay for the same services — rate and time
- Parts reimbursement at the prevailing retail price charged by the dealer for non-warranty work
- Manufacturers cannot impose unreasonable documentation requirements
- 30-day response window for manufacturer review
- Penalty provisions including potential 1.5x multiplier for manufacturer non-compliance
- Warranty, recall, and stop-sale repairs all covered at retail rates
What's Excluded from Calculations
The following repair types and transactions are typically excluded when calculating your retail warranty reimbursement rate:
- Manufacturer-supplied special tools (reimbursed separately)
- Goodwill repairs not covered under warranty
- Internal and employee vehicle work
- Wholesale parts transactions
Full Statute Text
815 ILCS 710/6 — Illinois Warranty Reimbursement Law
Source: Illinois State Legislature — This text is provided for informational purposes. Always consult the official state legislature website for the most current version.
Example: How Much Could You Recover?
An Illinois dealership processing 220 warranty ROs per month at $255 average generates $673,000 in annual warranty revenue. With Illinois' typical 22-32% uplift, that's $148,000-$215,000 in additional annual revenue. Add recall and stop-sale work at retail rates, and the total recovery can exceed $250,000 per year for a busy service department.
Pro Tips for Illinois Dealers
Don't overlook recall and stop-sale work — Illinois law covers these at retail rates too, significantly increasing your total recovery
The 1.5x multiplier provision gives you significant leverage in negotiations — manufacturers want to avoid triggering it
Illinois law prohibits 'unreasonable documentation requirements' — if the OEM is making the process unnecessarily burdensome, push back
Illinois Warranty Reimbursement FAQ
What is the Illinois 1.5x multiplier?
Under 815 ILCS 710/6, if a manufacturer fails to comply with warranty reimbursement requirements, dealers may be entitled to 1.5 times the amount owed. This penalty provision is one of the strongest in the country.
Does Illinois law cover recall work too?
Yes. Illinois law requires retail-rate reimbursement for warranty repairs, recall work, and stop-sale repairs — all at the same rate you charge retail customers.
How is the retail rate calculated in Illinois?
Illinois law says manufacturers must pay 'no less than the amount the retail customer pays for the same services with regard to rate and time.' This means your documented retail customer-pay labor rate and parts markup.
What's the response timeline in Illinois?
Manufacturers have 30 days to respond to rate adjustment requests. Given the 1.5x penalty provision, most OEMs take Illinois submissions very seriously.
Estimate Your Annual Uplift
See what your dealership could be earning in additional warranty reimbursement.
Estimated Annual Uplift
Illinois is a strong-tier state for warranty reimbursement. Learn more →
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