Finance-and-insurance sales have been a major profit booster and stabilizer since car prices started to balloon during Covid. But their contribution faces a drag from the very affordability issues they’ve been tempering for dealers.

The new F&I sales roadblocks are highlighted in Protective Asset Protection’s annual sector report, which shows fewer auto dealers, including in the specialty markets, seeing F&I growth and a big dip in those experiencing high growth.

Protective sees overall auto consumer affordability pressures affecting the crucial dealership revenue stream. In fact, 21% of consumers cited perceived lack of value in declining F&I products, up from 10% in 2024, a shift Protective interprets as “affordability headwinds.”

“Our 2025 report underscores a new phase for the automotive industry where market headwinds are beginning to take their toll,” said Senior Vice President and Chief Distribution Officer Rick Kurtz. 

“While F&I sales growth remains resilient for most, the rapid expansion we saw post-pandemic has given way to a more nuanced reality,” he said. “Dealers are no longer just overcoming price objections; they are tasked with a fundamental re-education of consumers to demonstrate the vital value of F&I protection in a high-cost environment.”

Many dealers still saw F&I sales growth last year, though the number fell significantly from 70% in 2024 to 62%, according to Protective’s research.

The high-growth segment, though, fell hard. Those experiencing F&I sales growth of more than 10% plummeted from 31% to 11%.

Still, the more moderate growth pace of 5% to 10% actually increased last year, the study found, from 40% in 2024 to 51%. At the same time, dealers seeing decreased F&I sales fell from 19% to 12%. 

Protective sees the moderating growth among dealers that are still improving returns as evidence they’re “effectively adapting to the challenges.”

Despite slowed growth overall, the study found bright spots, including that consumers still prioritized mechanical, technology and total-loss protections.

The firm advises dealers to emphasize early digital consumer education, including through artificial intelligence solutions; strategic technology additions; and products geared to affordability and used autos.

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