Warranty repair charge excessive due to 'betterment'

I bought a 12 year old BMW 330i in June and it drove beautifully until a sudden failure of the automatic gearbox a couple of weeks ago. I bought a Gold "Customer Protect" warranty for £595 through the dealer I bought the car from providing 2 year cover with a maximum limit of £2000.

They have agreed that the fault was a sudden broken part (a clutch apparently even though it's an automatic?) and authorised the work to be done with the Auto gearbox specialist repairing it.

However, the garage have informed me that the work will cost £2100 but they were told by the warrant company that they are only willing to pay £1400 due to "betterment".

Whilst I understand a reasonable charge could be made for betterment I fail to see how this applies in a BMW "sealed for life" gearbox and which now requires me to pay £700 in addition to the £595 I have already paid. The warranty company, Customer Protect, are unwilling to budge on this figure, I would not completely object if they had asked me to make a contribution of say £200-300 but I didn't even get the chance to negotiate, and £700 is outrageous!

In your experience, what are my chances of success for taking them to the small claims court or pursuing a legal challenge through my car insurance legal cover please?

Asked on 26 September 2012 by Mr R

Answered by Honest John
Take the matter up with the dealer who sold you the car and if he will not fork out a substantial part of the £1,400 "betterment", take the matter to the small claims track of the county court. Law here: www.honestjohn.co.uk/faq/consumer-rights/
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