1. Using Maintenance
  2. How You Manage Warranty Claims and Entitlements

How You Manage Warranty Claims and Entitlements

Warranty Claims are used to submit a request for reimbursement of asset repair costs to a supplier warranty provider. Claims are created in the context of a maintenance work order for an asset, and its related assets, that are covered under supplier warranty contracts.

Claims are primarily created using a scheduled process. However, claims can also be manually created to split an existing claim, allowing you to submit certain costs for reimbursement to a different warranty provider.

Claims can be automatically created only for work orders that are identified as a warranty repair. During work order creation, the checkbox will be set to “yes” on a work order header if one or more active contracts are found. The checkbox can then be manually set to “no” if the repair is determined not to be covered under warranty. After work order completion, this indicator will be used by the scheduled process, Generate Supplier Warranty Entitlements to determine if warranty claims should be created or not. The results can be reviewed using the output log of the scheduled process and by querying the results from the Warranty Entitlement and Warranty Claim REST APIs, as well as the Warranty Claims page.

Claims can also be manually created for any work order, regardless of the warranty repair indicator. If you have a work order with an existing claim, then you can manually create a new claim using the same or a different warranty provider. Then you can manually include any entitlements that aren't already included in another claim. For a work order without an existing claim, you can create a new claim and then manually create new entitlements for the reimbursement of work order costs.
Note: Work Orders with the warranty repair checkbox set to No won't have any Entitlements, nor a Claim created.

Warranty Claims Entitlements

Entitlements are used to track reimbursable expenses for items, resources, equipment, and standard repairs that are transacted during operation and work order completion. The scheduled process, Generate Supplier Warranty Entitlements evaluates each work order warranty repair indicator, then determine if a transaction is covered or not. Therefore, entitlements may or may not be created, based on setup and validations covered in this and the following sections.

For a warranty repair work order (checkbox is set to Yes), the scheduled process will review each work order operation transaction to determine if it is covered under warranty or not. During this review, the process will verify if one or more active warranty contracts for the work order asset, or its related assets, will cover the transaction cost or not for reimbursement:

  • If the transaction is covered, a claim entitlement is created that references the warranty contract. This entitlement is then used as the basis of creating a warranty claim against the contract’s warranty provider. The entitlement will reference the earliest expiring contract.
  • If a transaction is not covered, a claim entitlement is also created, with or without a warranty contract reference. It will not be associated to a claim as reimbursable. However, the entitlement can be later updated as covered by warranty and associated to a claim for the same work order.

As each subsequent transaction in the work order is reviewed, additional entitlements may be created and associated as reimbursable for the same claim, or even a different claim, or marked as not reimbursable. Each entitlement has a warranty contract reference that matches the claim's warranty provider. If all entitlements are created for a work order as not reimbursable, then a claim will not be created by the process. In this case, you can edit the entitlements to associate them to a manually created claim to resolve any data mismatch issues.

Entitlements will include the transaction costs once a work order has been successfully costed. By default, these costs will provide the basis for their reimbursement costs in a claim. The original costs can’t be edited in an entitlement; however, the reimbursement quantity and unit cost can be updated to reflect the requested amounts if they are different than the standard costs. The scheduled process Generate Supplier Warranty Entitlements will update existing entitlement costing if they were created before costing was completed.

Entitlements may be created that reference warranty contracts for different providers for the same work order. In this scenario, multiple claims may be automatically created for a work order. Each claim only has its matching entitlements associated by the common warranty provider. Additionally, you can manually create entitlements to recover additional work order costs, or to represent work order costs that aren't automatically created using the scheduled process.

Warranty Coverage For Material and Resource Transactions

A warranty coverage has optional indicators that guide if entitlements are created or not for resource and material transactions. Based on their values, entitlements may or not be created, or they may be created but not associated with a claim:

  • Labor Reimbursement – if this indicator is set to Yes, then resource and equipment transactions are eligible to create entitlements that are covered under warranty and associated to a claim. Else, entitlements are created but not associated to a claim.
  • Parts Reimbursement – if this indicator is set to Yes, then material transactions are eligible to create entitlements that are covered under warranty and associated to a claim. Else, entitlements are created but not associated to a claim.

Matching Transaction Coding

During work order creation, if the asset or its related assets are found to have active warranty contracts that use repair transaction codes in their base coverage, then the Match Transaction Codes checkbox is set to Yes at the work order header. In this case, it is expected that during the claims process only transactions that are covered by matching codes in warranty contract will be considered as covered by warranty. If the checkbox is set to No, then either there are no warranty contracts found or none of them have coding defined. Therefore, repair coding validations won't be considered by the warranty claims process.

If coding is defined in the warranty contract base coverages, it is also expected that coding is defined in the standard operations used to create work order operations and in the item definitions. In this case, operations, items, and resources will have repair coding included during work order creation. Before the completion of the first operation, you can update the Match Transaction Codes checkbox to No, regardless of coding on the operations. This setting will disregard warranty entitlement validation by coding in the claims and entitlements process. If coding was not defined in a standard operation or manually created operations are defined, you then you can optionally select coding at the operation, item, and resource levels prior to or during operation completion. The codes persist to the operation transactions and be considered by the warranty claims process.

For example, you have an operation transaction for an item that is being consumed in order to repair the brake system on a vehicle. The item has a code value that indicates it is part of a brake system. The transaction will be validated by the claims and entitlements scheduled process as follows:

  • If work order asset or related assets has one or more active contracts as of the work order start date, then verify if one or more contracts has a code in their base coverage that matches the transaction.
    • If a match is found, create an entitlement, and reference the first expiring contract, and include in a claim for the work order by matching warranty provider
    • If a match is not found, then create an entitlement, don’t reference a contract, and exclude it from any claims for the work order

If coding is not used, or the Match Transaction Codes checkbox is set to No, then the warranty claims and entitlements process won't use coding to validate warranty contracts. The entitlement will reference the earliest expiring contract. If an active contract is found, then entitlements are created for operation transactions for items, resources, and equipment. Otherwise, no entitlements nor claims are created.

Standard Repairs and Costs

Entitlements created for a warranty claim will include transaction costs based off the item, resource or equipment cost setups. For each operation, you may wish to use a standard repair labor cost and quantity instead of using the actual resource transactions and their costs. You can define the following:

  • Labor Rates: Use the Warranty Provider Rates REST API or manage page to define the hourly rate and currency for a resource by warranty provider. This value is used along with the Standard Repair Time by the claims and entitlements process for each resource entitlement instead of the standard resource cost and currency. The entitlement must have a warranty contract identified in order to match a labor rate by warranty provider. If a contract is not found, the standard resource cost rate will be used.
    Note: The Start Date of a Warranty Contract will be used to find the corresponding Labor Rate during Warranty Claim and Entitlement validation. Therefore, you will need to define past dated Labor Rates if you have Contracts that have past dated start dates.
  • Standard Repair Times: Use the Warranty Standard Repair Times REST API or manage page to define the repair time for a standard operation for a warranty provider. This value will be used along with the Labor Rate by the claims and entitlements process to create a unique entitlement by operation sequence, representing the labor quantity for the provider. If created, this entitlement will be included in the claim; however, entitlements for resources will be created but not included in a claim. The entitlement must have a warranty contract identified in order to find a matching standard repair time by warranty provider. If not found, then the unique entitlement will not be created and individual resource entitlements will be created for resource transactions.
    Note: The Start Date of a Warranty Contract will be used to find the corresponding Standard Operation Repair Times during Warranty Claim and Entitlement validation. Therefore, you will need to define past dated Repair Times if you have Contracts that have past dated start dates.

Warranty Claims Scheduled Process

It is recommended to run this process frequently after operation and work order completion, as well as after costing is complete. The process reviews warranty-entitled work orders, creating claim entitlement records for each material, resource, and equipment transaction. If these expenses are covered by a warranty contract, then they will be grouped in one or more warranty claims by a matching provider.

The process also takes into consideration if repair coding is defined in warranty coverages or not by referencing the Match Transaction Codes checkbox at the work order header. If this checkbox option set to Yes on the work order header, the process only creates warranty entitlements and claims for those expenses where the repair code matches a warranty contract. Else, the entitlements are created, but indicated as not warranty in the claim.

Note: It is generally recommended to run costing for work orders prior to generating warranty claims. While the claims scheduled process will update existing entitlements with costing information, it may be more useful for you to create claims after costing has already processed.

How You Manage And Create Claims

You can search, view, update, and create claims using the Manage Claims page. The results can be filtered by attributes such as the work order number, asset number, warranty provider, claim number or claim type. Clicking on the work order or asset hyperlinks will navigate you to their respective pages, where you can use the back navigation arrow on the browser to return to the list of claims. Click the claim hyperlink to view and edit a claim.

You can also optionally select a claim row and click the Update action. This renders a drawer where you can review and edit key attributes for claim.

Field Description
Claim Status The status of a claim can be updated to a seeded or customer-defined status value.
Submit By (Date) Optional date by which you should submit a claim to a warranty provider.
Claim Type Optional customer-defined value for the type of a claim.
Assigned To Optional reference to the worker who is managing or responsible for the claim.

Claims may be manually created using the Create Claim action. This action will render a drawer where you can define key attributes for claim.

Field Description
Work Order Maintenance work order for which you are creating a claim.
Warranty Provider Name Supplier to whom you submit the claim.
Claim Status The status of a claim can be updated to a seeded or customer-defined status value.
Submit By Optional date by which you should submit a claim to a warranty provider.
Claim Type Optional customer-defined value for the type of a claim.
Assigned To Optional reference to the worker who is managing or responsible for the claim.
Claim Notes Optional reference notes for a claim.

Claims that are created by the scheduled process will be defaulted to a status of Pending Review. It is expected that Claims will be reviewed, updated, submitted to a provider, and then finally closed as resolved over their lifetime. During this process, you can manually progress the claim by updating its status value. For some providers, you may need to extract the claim and entitlement details and submit using provider specific formats.

How You View and Edit a Claim

Click the Claim hyperlink in the results rows to see the Claim Details pages.

Step 1: Check your claim

Step 1 lets you to check your claim by reviewing a read-only summary of the claim:
Field Description
Claim Amount Total amount of all entitlements and adjustments that are included in a claim.
Entitlements to Be Reimbursed Number of entitlements that are included in a claim.
Warranty Provider Name Supplier to which you submit your claim.
Claim Status Status of a claim.
Submit By Optional date by which you should submit a claim to a warranty provider.
Asset Number The asset from a work order.
Serial Number Serial number of a work order asset.
Organization Maintenance organization of a work order.
Work Order Number Reference to a work order.
Work Order Total Cost Total cost of a work order.
Work Order Description Description of a work order.
Note: If Claim Amount and Work Order Total Cost are different, it means that one or more work order transactions weren't included as entitlements in the claim. You can review these details on Step 3.

Step 2: Claim Essentials

Step 2 is used to review and update the claim essential details:
Field Description
Work Order You can only update the work order and warranty provider for a manually created claim that doesn’t have any entitlements included. Otherwise, it's read-only.
Warranty Provider Name You can only update the work order and warranty provider for a manually created claim that doesn’t have any entitlements included. Otherwise, it's read-only.
Start Date Defaults to the creation date of the claim but can be updated to any date.
Claim Status Status of a claim.
Claim Type Optional customer-defined value for the type of a claim.
Submit By Optional date by which you should submit a claim to a warranty provider.
Assigned To Optional reference to the worker who is managing or responsible for a claim.
Claim Reference Optional reference for the reimbursement of a claim. Examples include a credit memo or reimbursement check reference.
Claim Resolution Date Date when a claim is resolved.
Reimbursement Type Optional customer-defined value for the type of reimbursement of a claim.
Reimbursement Amount Optional value that represents the reimbursement of a claim.
Claim Notes Optional reference notes for a claim. Default value may be the work order number.

Step 3: Include Entitlements

Step 3 is used to view the included, excluded, or all entitlements in a claim. By default, the page only displays the included entitlements. For each entitlement row, you can view the entitlement details, including:
  • Operation transaction type and description
  • Warranty contract (optional) is entitlements created by the scheduled process will have a contract value
  • Repair Coding, if defined, comes from the operation, item, or resource transaction
  • Total Reimbursement Cost defaults from the work order transaction costs

When an entitlement is included or excluded, the claim totals are recalculated.

For each entitlement row, click the edit pencil to view and edit the key details of an entitlement:
Field Description
Type The type of an entitlement based on the source of the operation transaction:
  • Equipment charge
  • Equipment reversal
  • Material issue
  • Material return
  • Other
  • Standard repair
  • Resource charge
  • Resource reversal

The type is read-only for entitlements created by the scheduled process.

The type is required for manually defined entitlements.
Description The entitlement description is read-only for entitlements created by the scheduled process based on an operation transaction:
  • For a material issue, the value will be item and item description
  • For a resource charge, the value will be the resource code and name
  • For an equipment charge, the value will be the resource code and name
  • For a standard repair, the value will be the standard operation code
The description is optional for manually defined entitlements.
Reason for Repair Code The reason for repair code is displayed if the entitlement was created by the scheduled process and the value was recorded in the operation or resource transaction. You can optionally update the value.

The code is optional for manually defined entitlements.
Repair Transaction Code The repair transaction code is displayed if the entitlement was created by the scheduled process and the value was recorded in the material issue transaction. You can optionally update the value.

The code is optional for manually defined entitlements.
Work Accomplished Code The work accomplished code is displayed if the entitlement was created by the scheduled process and the value was recorded in the operation or resource transaction. You can optionally update the value.

The code is optional for manually defined entitlements.
Warranty Contract The warranty contract will be displayed if the entitlement was created by the scheduled process for a warranty repair. You can optionally update the value to another contract that is active for the asset or its related assets.

The code is optional for manually defined entitlements.

If a contract is defined for an entitlement, then it may only be included in a claim that has a matching provider, else an error is presented.
Contract Status Read-only value for the selected contract.
Contract Start Date Read-only value for the selected contract.
Contract End Date Read-only value for the selected contract.
Calculated Expiration Date Read-only value for the selected contract if meters are referenced.
Asset Number Read-only value for the selected contract’s asset. This may be the same as the work order asset or may be a child asset.
Asset Serial Number Serial number of the selected contract asset. The value is read-only.
Cost Quantity Quantity of the operation transaction that was costed. The value is read-only.

Manually created entitlements won't display this value.
Cost UOM Unit of measure of the operation transaction that was costed. The value is read-only.

Manually created entitlements won't display this value.
Currency Currency of the operation transaction that was costed. The value is read-only.

Manually created entitlements won't display this value.
Unit Cost Unit cost of the operation transaction that was costed. The value is read-only.

Manually created entitlements won't display this value.
Total Cost Amount Total cost amount of the operation transaction that was costed. The value is read-only.
Reimbursement Quantity Quantity of the reimbursement for the entitlement.
Reimbursement UOM Unit of measure of the entitlement. Examples are EA or Hour.
Currency Currency of the entitlement.
Reimbursement Unit Cost Cost per unit of quantity of an entitlement.
Total Reimbursement Amount Total cost of the entitlement. Equal to the Quantity x Unit Cost.
Additional Notes Optional notes for an entitlement.
Note: If you are defining reimbursement details, you must define the quantity, UOM, currency and unit cost. Else, the total reimbursement amount won't be calculated, and an error appears.

Step 4: Review claim amounts

Step 4 provides an overview of each type of included entitlement reimbursable amount and a claim total. When an entitlement is included or excluded, the claim totals by type and the claim total recalculates. Optionally, you can define an adjustment value, making a quick edit to the total claim amount.

How You Manage Warranty Claims and Warranty Entitlements Using REST API

You can define, view, and update warranty claims and entitlements using their REST services. These services are also used by the Warranty Claims search, view and edit pages.
  • Use the Warranty Entitlements REST API to create, get, and update the warranty entitlements for work order or claim.
  • Use the Warranty Claims REST API to create, get, and update the warranty claims for a work order.

See the REST API for Oracle Supply Chain Management Cloud guide to learn more.