BMW Extended warranty
Discussion
Here follows a letter from the BMW (UK) MD
Don't drive your cars too hard!!!!
Dear Mr XXXX
Thank you for your feedback on our warranty pricing strategy.
We take no delight in increasing the costs of these policies but have been forced to make pricing decisions in light of the new FSA regulations.
By having to apply non-recoverable Insurance Premium Tax and Value Added Tax along with involving an insurance company with commercial goals we have ended up with a pricing structure higher than we would have liked.
We therefore took steps to try and stabilise the costs by introducing an excess payment in the policy. Although this is unique to the warranty business it is not new to the insurance industry and does have the effect of helping to keep premiums low.
It is a fact of life that M series cars cost more to repair than our standard models and indeed are generally driven much harder by those who buy them. Before FSA regulations came into effect we cross subsidised M models from the rest of the range to keep premiums at an acceptable level. However this is not sustainable and we have adjusted prices accordingly.
As a result the cost increase on these policies is higher than on the rest of the range. In fact the prices for 3 Series and 5 Series warranties have fallen as a consequence of our actions.
It is not in our interests to alienate customers and I can assure you that we are constantly working towards reducing the premiums in whatever way we can for all models. I hope that in 12 months time you will see further stabilisation of our warranty prices.
Since our Approved Used Car (AUC) Programme falls outside FSA regulation any vehicle bought from our dealer network under this scheme will have, included in the screen price, a 12 month unlimited mileage warranty without excess constraints or battery or steering limitations and you may wish to consider this when you next purchase a BMW.
I am sorry for any inconvenience this has caused you and I hope that you continue to be a BMW customer for many years to come.
Kind regards,
Jim O'Donnell
Managing Director
BMW (UK) Limited
Don't drive your cars too hard!!!!
Dear Mr XXXX
Thank you for your feedback on our warranty pricing strategy.
We take no delight in increasing the costs of these policies but have been forced to make pricing decisions in light of the new FSA regulations.
By having to apply non-recoverable Insurance Premium Tax and Value Added Tax along with involving an insurance company with commercial goals we have ended up with a pricing structure higher than we would have liked.
We therefore took steps to try and stabilise the costs by introducing an excess payment in the policy. Although this is unique to the warranty business it is not new to the insurance industry and does have the effect of helping to keep premiums low.
It is a fact of life that M series cars cost more to repair than our standard models and indeed are generally driven much harder by those who buy them. Before FSA regulations came into effect we cross subsidised M models from the rest of the range to keep premiums at an acceptable level. However this is not sustainable and we have adjusted prices accordingly.
As a result the cost increase on these policies is higher than on the rest of the range. In fact the prices for 3 Series and 5 Series warranties have fallen as a consequence of our actions.
It is not in our interests to alienate customers and I can assure you that we are constantly working towards reducing the premiums in whatever way we can for all models. I hope that in 12 months time you will see further stabilisation of our warranty prices.
Since our Approved Used Car (AUC) Programme falls outside FSA regulation any vehicle bought from our dealer network under this scheme will have, included in the screen price, a 12 month unlimited mileage warranty without excess constraints or battery or steering limitations and you may wish to consider this when you next purchase a BMW.
I am sorry for any inconvenience this has caused you and I hope that you continue to be a BMW customer for many years to come.
Kind regards,
Jim O'Donnell
Managing Director
BMW (UK) Limited
When it came time to renew the warranty for my 1999 323 coupe I couldn't believe it had gone up from something like £450 to £725 (ish). I bought it anyway knowing that my MOT was due within seven days and that any MOT failure would be covered, even if it wouldn't ordinarily be covered by the warranty - once got a full set of shock absorbers out of that!
Anyway, the car sailed through (done at BMW dealer) with nothing even looking like it would need attention in the near future and then cancelled the warranty (fourteen days from purchase to do so) so at least I had two weeks of free coverage out of it!
Anyway, the car sailed through (done at BMW dealer) with nothing even looking like it would need attention in the near future and then cancelled the warranty (fourteen days from purchase to do so) so at least I had two weeks of free coverage out of it!
deutscher said:
Seeing as they put it like that........
Fair do's
I am outraged!!
>> Edited by deutscher on Friday 3rd February 20:33
Not joking, in that I too would not be happy sponsoring someone elses extended warranty.
Currently I have an E46 M3 SMG (Plenty to go wrong you could say) I don't expect Mr 318 to chip in towards my toy, he doesn't get to play in it, so why should he pay for it, if you get where I'm coming from.
My warranty runs out in September and I'm not looking forward to coughing up but I feel it's too risky not to and can't justify (Read "Afford" ). Buying a new one just to get another 3 free years. "
>> Edited by Dave Dax builder on Saturday 4th February 16:53
deutscher said:
I don't see how they can justify the warranty on an M3 costing twice as much as one on a Porsche 911.
Agreed - its ridiculous.
£510 -> £ 720 -> £ 1050 or £1800 per annum plus £ 250 excess.
Anyone who thinks that's reasonable lives on planet cuckoo (or hasn't a clue what they are talking about)
Gassing Station | BMW General | Top of Page | What's New | My Stuff