Penn Warranty Complaint - Deceptive Auto Warranty Contract Terms
I purchased a Penn Warranty Platinum contract for $1,300. When my transmission broke, Penn Warranty authorized a reimbursement amount without ever reviewing the reimbursement amount with me, the customer. Once authorized, a claim must be contested through their Disputes process. It is my opinion that they have designed the Disputes process to be a lengthy, paper-intensive process to discourage customers from disputing claims.
Most disturbing, Penn also authorized a reimbursement amount based on the cost of a used transmission with 69,000 miles that they located in a junkyard in New Hampshire (my car was being fixed South of Boston).
I am dissatisfied with Penn Warranty's service for two reasons: 1) Penn Warranty recognizes a customer's mechanic as the customer's agent, but they do not notify the customer of this policy even if the customer makes no action or indication of this arrangement, 2) In my opinion, Penn Warranty interprets a clause in their contracts in a way that no reasonable person would do so.
Penn Warranty essentially claims that my mechanic was acting as an agent when he did not contest their proposed reimbursement amount for the repairs to my vehicle. This assertion is false. I never implied either in writing, verbally or by action that I intended my mechanic to negotiate with Penn Warranty on my behalf. Upon receiving the reimbursement amount proposal, my mechanic immediately called me with the proposal amount. I then called Penn Warranty who stated that my mechanic had already authorized the amount and that to contest the amount, I would have to complete a lengthy disputes process. When Penn Warranty called my mechanic with their proposed reimbursement amount, my mechanics subsequent actions described above prove that he never intended nor did I intend for him to act as my agent. Their assumption that my mechanic was acting as my agent was incorrect legally and is also bad business.
The terms of my Penn Warranty contract state the following: "When making repairs, the repair shop shall use components of the same type and quality as those removed which may include used components." As a reasonable consumer, I interpreted this clause to mean the following:
"When making repairs, the repair shop shall use components of the same type and quality as those removed"
A reasonable consumer would interpret this part of the sentence to indicate that a mechanic shall not replace a brake pad of "B" quality with a pad of "A" quality or of "C" quality. This sentence leads a reasonable consumer to believe that he is being protected against sub-par components and that Penn Warranty is being protected against replacing a low-end part with a high-end part.
"...which may include used components." A reasonable consumer would interpret this part of the sentence to mean that if used components are in compliance with the requirement in the first part of the sentence (part a), then those used parts MAY be used. Emphasis on the word "may" implies an option to comply. Since this sentence is in the section entitled "What You Must Do ('You' being the customer)", again, a reasonable person would assume that the option to utilize a used part is up to the customer.
One of the most important interpretation differences pertains to the time frame applied to the section "shall use components of the same type and quality as those removed. The "same type and quality" at what time in the service life of the part? Again, as a reasonable consumer, should I expect a used part to suffice for a repair, it would have to function not like the part that broke did right before it broke (i.e., replacing my 69,000 mile transmission with a 69,000 mile transmission from a junkyard in NH), but as the part that broke functioned around (i.e., new or used) the time of its original install.