If a dealer wants to offer their own uninsured extended warranty, how much must they provide to the Compensation Fund?

The requirement for a dealer who wants to offer their own uninsured extended warranty to contribute to the Compensation Fund is based on the regulatory framework that ensures consumer protection in the event of warranty claims not being honored. The correct answer indicates that a dealer must provide $100,000 to the Compensation Fund. This amount serves as a financial safety net to protect consumers who may be affected should the dealer fail to fulfill their warranty obligations.

By contributing this specified amount, the dealer demonstrates a commitment to consumer protection and compliance with the regulations that govern automotive sales. This regulation is crucial because consumer trust and confidence are essential in the automotive marketplace, ensuring that buyers have recourse in the event of disputes over warranty claims. The other amounts listed (like $250,000, $500,000, or $1,000,000) are higher than what is mandated, and therefore do not reflect the actual requirement set by the governing laws regarding the Compensation Fund for dealers offering their own warranties.