The consumer’s issue:
“I purchased an extended warranty for my 59-plate SUV, which I bought in 2018. A year later, in 2019, I made a claim on the policy to cover repairs to my power steering, which had suddenly stopped working. I was driving and slowed down as a car was approaching from the opposite direction, but when I tried to turn the wheel to pull back out, the power steering would not work.
I drove just over a mile to the dealership that had sold me the car and warranty a year earlier, where the mechanic advised me that the power steering had failed. There hadn’t been any previous issues with the power steering, but the claim was declined because the business said this was not a sudden mechanical failure. I disagreed with this, but the receptionist at the dealership who completed the claim form mistakenly said that the failure was intermittent.
To resolve my complaint, I am looking for the business to reimburse me for the £1,000 I spent to have the repairs completed.”
The accredited business’ response:
- The customer purchased a mechanical breakdown agreement, which covers the failure of a part when there is a complete stoppage of function, for a reason other than wear and tear, deterioration, or negligence.
- The dealership investigating the fault had explained that the power steering pump was failing, but was still operating. Therefore, there hadn’t been a sudden stoppage of function.
- As we have acted in accordance with the terms of the agreement, based on the information supplied by the repairer, we are unable to uphold the consumer’s complaint, and we stand by our decision to decline the claim.
The adjudication outcome:
- The Motor Ombudsman adjudicator agreed with the warranty provider that the failure was not covered by the terms and conditions of the mechanical breakdown agreement, as the evidence demonstrated it was an intermittent fault, meaning the power steering pump had not yet completely failed.
- Therefore, as the claim had been correctly declined, the adjudicator could not uphold the complaint in the consumer’s favour.
- The customer however, disagreed with the adjudicator’s assessment and asked for an ombudsman’s final decision.
The ombudsman’s final decision:
- The ombudsman reviewed the terms and conditions of the warranty and explained that there needed to be a sudden mechanical breakdown of a part for a claim to be approved.
- She noted the consumer had gone back to the dealership that had provided a diagnosis of what had caused the breakdown.
- She added that the dealership had identified that the power steering fluid was contaminated with metal fragments and that the pump was in the process of breaking down. They said that continued use of the car would result in the total loss of the power steering.
- The ombudsman therefore said that the diagnosing dealership had confirmed there was in fact no sudden failure, rather a part was in the process of failing.
- The ombudsman noted the dealership had said the breakdown was not due to wear and tear or negligence, but they also had not stated what was causing the breakdown.
- The ombudsman went on to explain that the car was 10 years old and had covered over 60,000 miles, so it was more likely than not that the gradual failure was simply a result of wear and tear and in-service use.
- The ombudsman then went on to highlight that the terms and conditions specifically excluded wear and tear or a gradual reduction in operating performance commensurate with the age of the vehicle and mileage covered.
- In conclusion, the ombudsman did not think there had been a sudden breakdown as defined by the terms and conditions of the warranty. Therefore, mirroring the adjudication outcome, the complaint was not upheld in favour of the consumer.
- The consumer did not respond to the decision, and the case was closed.