Zurich Extended Warranty - Junkyard Motor Replacement

[93hrdtptt]

Soo...I posted not too long ago in regards to the motor burning oil and my left bank of cylinders had been scored. After tearing the motor down and getting the approval for repair this is what Zurich Warranty is trying to do.

My car has 94k on it, the only option they are giving me is putting a 78k junkyard motor from one of their suppliers which is "verified" running.

- They do not look inside the motor
- They do not do any type of internal inspections to make sure the motor is guaranteed to spec. (Like kind and quality per their contract wording)

The Zurich Insurance Adjuster is justifying the fact that their motor has 77k on it, that it is "newer" and of "like quality" only because their 3rd party supplier tossed it on a dyno and started the thing up.

The contract states - "Replacements will be made with parts of like kind and quality(including new, re-manufactured, exchanged, or serviceable used components or parts at our option.)

The bold is where they are trying to stick me. The only "warranty" they are giving on the junkyard motor is the remaining 6,000 miles left on my original warranty.

If they are not inspecting it, they are assuming, and assuming is not like kind and quality.

They are refusing to inspect and teardown the motor to confirm quality. (Unlike the fact they made me do a leakdown/compression/boroscope/teardown to confirm damaged goods)

It is staying as a sealed unit
they are NOT giving me the VIN so I can look at history
they are NOT giving me the ecu or at the very least check fault codes from that motor. (over rev, re-flash, ect.)

So my dilemma lies in the fact I am not receiving full disclosure of this motor and who knows what's going to happen in the near future.

Thoughts? Anybody had this experience? Apparently Zurich takes kind to junkyard motors as I have heard this happening on many occasions.

Thanks for reading.

P.S - AoA is refusing to do anything, which I can maybe understand since its way out of manufacturer warranty, but still.

[dparm]

Well what sort of warranty does the new motor carry? What if you want to source your own motor instead?

[93hrdtptt]

Well what sort of warranty does the new motor carry? What if you want to source your own motor instead?

The new motor carries only the remaining warranty of my vehicle. They go by odometer and not the mileage of the motor, so in my case, I have 6,000 miles left.

In regards to procuring a motor of my own. Apparently, it must come with Labor and Parts warranty from that supplier. So for example, I found a 30k motor from Shokan, but they only carry a parts warranty. Zurich denied the purchase request

[Scotty@Advanced]

The new motor carries only the remaining warranty of my vehicle. They go by odometer and not the mileage of the motor, so in my case, I have 6,000 miles left.

In regards to procuring a motor of my own. Apparently, it must come with Labor and Parts warranty from that supplier. So for example, I found a 30k motor from Shokan, but they only carry a parts warranty. Zurich denied the purchase request

An insurance company is in it to make money, and the less they spend on claims the more money they make. You can't say they are "Sticking it to you" for operating within the scope of the contract, which specifically states that they can utilize used components. You did read the contract before you signed it right?

Your options are:

See if there is a "Cash Out" clause in your contract. If there is take the money and source the repairs/parts yourself.

Find out what the cost of the used engine is and see what a new short block would cost including the P&L to install the heads etc then pay the difference. If it's at an Audi dealership IIRC Audi offers a 1 or 2 year P&L warranty on parts. Then pay the difference. Present this information to Zurich and see if they are willing to accommodate you.

However I wouldn't worry about the quality of the engine, a tested used engine is a tested used engine if it's from Shokan, or any other dismantler. Just make sure that it has a Parts and labor warranty if the replacement engine goes out during your warranty contract.

[93hrdtptt]

An insurance company is in it to make money, and the less they spend on claims the more money they make. You can't say they are "Sticking it to you" for operating within the scope of the contract, which specifically states that they can utilize used components. You did read the contract before you signed it right?

Your options are:

See if there is a "Cash Out" clause in your contract. If there is take the money and source the repairs/parts yourself.

Find out what the cost of the used engine is and see what a new short block would cost including the P&L to install the heads etc then pay the difference. If it's at an Audi dealership IIRC Audi offers a 1 or 2 year P&L warranty on parts. Then pay the difference. Present this information to Zurich and see if they are willing to accommodate you.

However I wouldn't worry about the quality of the engine, a tested used engine is a tested used engine if it's from Shokan, or any other dismantler. Just make sure that it has a Parts and labor warranty if the replacement engine goes out during your warranty contract.

Of course I read the contract, but "assumed" this type of scenario wouldn't happen So I'll take the blame for that.

In regards to used components, yeah, thats fine, use them. But dont toss it on a dyno and start it up and tell me its like kind and quality without doing any internal inspection first. MY motor with clawmarks down the cylinder walls "runs" so without an internal inspection how are you going to guarantee me anything? These are all just assumptions

[J0HN_R1]

I too went thru a similar scenario recently, with my alternator replacement...

I'm worried about something like this happening (an entire engine replacement), but have a feeling it's inevitable...

I'm contacting the news shortly concerning this very disturbing practice by warranty Co's...

Regardless what the contract says, who (besides scam-artists) replaces parts under warranty with used sh!t..?

[Scotty@Advanced]

Of course I read the contract, but "assumed" this type of scenario wouldn't happen So I'll take the blame for that.

In regards to used components, yeah, thats fine, use them. But dont toss it on a dyno and start it up and tell me its like kind and quality without doing any internal inspection first. MY motor with clawmarks down the cylinder walls "runs" so without an internal inspection how are you going to guarantee me anything? These are all just assumptions

The only 100% guaranteed things in life are death and taxes.

[RAudi Driver]

You should bring up the fact that if they replace your motor with a motor that is like kind and quality, that would be a motor with scored cylinder walls. However, putting a new motor in a car with 94k on it is asking a little much from a warranty company.

I would call other warranty companies and inquire about warranties. I would pose the scenario and see what the other insurance company would do in this case. You'll get a better idea of how you're really getting treated by Zurich.

[MrZero]

You should bring up the fact that if they replace your motor with a motor that is like kind and quality, that would be a motor with scored cylinder walls. However, putting a new motor in a car with 94k on it is asking a little much from a warranty company.

I would call other warranty companies and inquire about warranties. I would pose the scenario and see what the other insurance company would do in this case. You'll get a better idea of how you're really getting treated by Zurich.

My goodness. With all the horror stories about extended warranty companies I think I'll just save the cash and 'self insure'.

[P0234]

The Zurich Insurance Adjuster is justifying the fact that their motor has 77k on it, that it is "newer" and of "like quality" only because their 3rd party supplier tossed it on a dyno and started the thing up.

If you think the junkyard put your motor on a dyno... I've a bridge I can let you have for a good price. The only thing that happened was Earl over at the 'yard manage to get the car started and it sounded good to his ears. Most decent yards do warranty the part for at least a year. One thing you need to verify if the engine is from your model year or newer. Lots of states have rules about putting older motors in cars when it comes to emissions inspections. This is not a well enforced rule, but it might work to your advantage.

You would do well to call around to various yards and try to find the engine in question, they will likely give you a vin (if they put up a fight, just say you want to verify its not stolen) or at least a bit more info. That said, your warranty company isn't scamming you, they are holding up their end of the bargain. A lesser warranty would have tried to put the blame on you.

[road race s4]

My goodness. With all the horror stories about extended warranty companies I think I'll just save the cash and 'self insure'.

In some cases the warranty is cheaper. I paid $3000 for a 3year/36k mile warranty with a $100 deductible. In the first 6 months the Valve cover gaskets and A/C compressor were changed under warranty. Total repair came to about $2800. So already the warranty paid for itself. Now if the alternator/starter/control arms/etc go (which I know they will) I know I don't have to worry about it anymore.

[J0HN_R1]

However, putting a new motor in a car with 94k on it is asking a little much from a warranty company...

Wrong... That's what we payed for... New replacement parts, should the current equipment fail...

If they didn't want to be on the hook for a $15k engine, they should have either had the engine checked thoroughly (scoped) before issuing coverage, or not warrantied it... Period...

[RAudi Driver]

^^Obviously not! In theory, it should work and probably with a better warranty company the covered party would be getting a new motor. however, Zurich looks like they covered the bases and are playing the out card.

Op, tell Zurich that since the only part that failed was the block, you are requesting that only the failed part be replaced. Fight for this! This way, they will have to tear down your current motor and replace just the block. You'll get all your original parts back, which is what I would want, and you'll get to see what condition the block is in. Then pose the complete new motor alternative.


Tell them that if the part isn't broken, you're not obligated to have it replaced. Intakes, injectors, etc... are all working properly. Force them to dismantle the motor or give you a new one. Read the fine print on your warranty first and then hit em as hard as you can. They're doing to same to you and don't think that they aren't.

[Scotty@Advanced]

Wrong... That's what we payed for... New replacement parts, should the current equipment fail...

If they didn't want to be on the hook for a $15k engine, they should have either had the engine checked thoroughly (scoped) before issuing coverage, or not warrantied it... Period...

Your incorrect the OP paid for a warranty contract that specifically stated "Replacements will be made with parts of like kind and quality(including new, re-manufactured, exchanged, or serviceable used components or parts at our option.)" No where in that clause does it say " New Parts" only.

If your thinking that a warranty company should install a new engine out of the kindness of their heart your greatly mistaken. If the contract did say "New Parts Only" then the OP would have a legal remedy.

^^Obviously not! In theory, it should work and probably with a better warranty company the covered party would be getting a new motor. however, Zurich looks like they covered the bases and are playing the out card.

Op, tell Zurich that since the only part that failed was the block, you are requesting that only the failed part be replaced. Fight for this! This way, they will have to tear down your current motor and replace just the block. You'll get all your original parts back, which is what I would want, and you'll get to see what condition the block is in. Then pose the complete new motor alternative.


Tell them that if the part isn't broken, you're not obligated to have it replaced. Intakes, injectors, etc... are all working properly. Force them to dismantle the motor or give you a new one. Read the fine print on your warranty first and then hit em as hard as you can. They're doing to same to you and don't think that they aren't.

RaudiDriver has a good point, get estimates for a short block replacement or an overhaul of your existing engine and compare pricing. If it's more you might be able to negotiate with the ins company (pay the difference). Don't forget that you can also shop around for labor, and let the shop know that.

If it's an Audi dealer the short block will have a 100% full replacement warranty including labor for 1 or 2 years.

If it looks like a better deal to the Zurich and is going to save them money or a big headache they will likely oblige.

[RAudi Driver]

We're on the right track here. You know, even if it doesn't save Zurich money to rebuild the bad motor, the op might have a case if if can pick apart the contract to get a leg to stand on regarding not having to give up perfectly working parts that he owns. It might be a little far fetched, but it's certainly worth opening your file cabinet and looking over the contract.

I would certainly opt for a new block and my current existing parts than another complete used motor.


OP, post up your contract!

[Tony951]

As information, I have a used 58K longblock (valve covers to oilpan) from Shokan and they have a 6mo warranty (replacement) if I get low compression or failure, they assured me. I am installing this engine now (10/6/10) and expect to be complete in another week or so when I get all my parts. Shokan gave me the VIN# and stated that they start up all used motors and check for CELs. If the cylinder walls have scoring, then you should be fouling plugs and getting a CEL. I don't know how bad the scoring (or compression) has to be to get the CEL. Shokan also says they pull off the timing covers and inspect the guides, etc, but for some reason I have my doubts. You have to replace 2 gaskets and reseal the covers. If you get a longblock, there are a ton of seals you probably should replace. It ran me nearly $300 for all the seals and the $80 Audi thermostat.

Additional info: A new shortblock from Audi is about $10K when I priced it out. A new engine from Audi (IRA Audi in Peabody, MA) will run about $24K installed...

[93hrdtptt]

Your incorrect the OP paid for a warranty contract that specifically stated "Replacements will be made with parts of like kind and quality(including new, re-manufactured, exchanged, or serviceable used components or parts at our option.)" No where in that clause does it say " New Parts" only.

If your thinking that a warranty company should install a new engine out of the kindness of their heart your greatly mistaken. If the contract did say "New Parts Only" then the OP would have a legal remedy.



RaudiDriver has a good point, get estimates for a short block replacement or an overhaul of your existing engine and compare pricing. If it's more you might be able to negotiate with the ins company (pay the difference). Don't forget that you can also shop around for labor, and let the shop know that.

If it's an Audi dealer the short block will have a 100% full replacement warranty including labor for 1 or 2 years.

If it looks like a better deal to the Zurich and is going to save them money or a big headache they will likely oblige.

Audi sells a remanufactured shortblock for 12.5k, Zurich is telling me they quoted the repair and the price CAP is 5,800. This is what they deem appropriate. (obviously this includes the 78k motor from their supplier) Essentially, if I want peace of mind and a "to manufacturer spec of like kind and quality" this is the only option, however if I want this. It is to come out of my pocket for the difference (12,500 - 5,800) this is how the back and forth started.

We're on the right track here. You know, even if it doesn't save Zurich money to rebuild the bad motor, the op might have a case if if can pick apart the contract to get a leg to stand on regarding not having to give up perfectly working parts that he owns. It might be a little far fetched, but it's certainly worth opening your file cabinet and looking over the contract.

I would certainly opt for a new block and my current existing parts than another complete used motor.


OP, post up your contract!

I'll see if I can scan a copy of the contract but the only pertinent piece of information in regards to coverage and replacement is what I had originally posted. It goes as stated..

"Replacements will be made with parts of like kind and quality(including new, re-manufactured, exchanged, or serviceable used components or parts at our option.)

This is pretty much the only part we can pick apart.

- Yes, they are within their right to supply a used motor, BUT it must be of LIKE KIND and of LIKE QUALITY to OEM, therefore if you are giving me a motor with 78,000 miles WITHOUT checking any internal operations (valves,guides,pistons,cylinder walls,compression,leakdown,ect, ect, ect,ect) One cannot tell me that they are putting something of like kind and quality anything, it is all speculations and assumptions. The contract does not allow for assumptions and speculation therefore its a farce.

Am I out of line? I only want fairness, and thus an unknown piece of machinery put in my car without any disclosure is unjust and unfair.

[93hrdtptt]

As information, I have a used 58K longblock (valve covers to oilpan) from Shokan and they have a 6mo warranty (replacement) if I get low compression or failure, they assured me. I am installing this engine now (10/6/10) and expect to be complete in another week or so when I get all my parts. Shokan gave me the VIN# and stated that they start up all used motors and check for CELs. If the cylinder walls have scoring, then you should be fouling plugs and getting a CEL. I don't know how bad the scoring (or compression) has to be to get the CEL. Shokan also says they pull off the timing covers and inspect the guides, etc, but for some reason I have my doubts. You have to replace 2 gaskets and reseal the covers. If you get a longblock, there are a ton of seals you probably should replace. It ran me nearly $300 for all the seals and the $80 Audi thermostat.

Additional info: A new shortblock from Audi is about $10K when I priced it out. A new engine from Audi (IRA Audi in Peabody, MA) will run about $24K installed...

Hey Tony,

This was one of my original plans, however per Zurich; Shokan does not warrant labor, only parts in their 6 month unlimited mileage warranty. Therefore Zurich denied the request for me to purchase the motor ( Even though it was actually saving Zurich ~1,000 bucks). Doesnt make sense to me, but thats per their policy.

So if I were to procure a motor myself, the supplier would have to have a Labor & Parts Warranty included with the purchased motor.

[J0HN_R1]

Your incorrect, the OP paid for a warranty contract that specifically stated "Replacements will be made with parts of like kind and quality (including new, re-manufactured, exchanged, or serviceable used components or parts at our option.)"

No where in that clause does it say " New Parts" only.

If your thinking that a warranty company should install a new engine out of the kindness of their heart your greatly mistaken.

If the contract did say "New Parts Only" then the OP would have a legal remedy...

I'm pretty sure I know exactly what the O.P. payed for. I payed for the same thing (but different Co.) and went thru almost the exact same situation (different part, same song&dance)...

Point is, the broker/salesman who sells you a warranty that allows the use of used parts as replacements, should fuking tell you instead of having to meticulously read 3pgs (front & back, so 6pgs) of fine details...

Not to mention, the practice (of using junkyard parts for warranty claims) shouldn't even be allowed by the governing powers that regulate warranty & insurance Co's...

[ronaldmcdonald]

- Yes, they are within their right to supply a used motor, BUT it must be of LIKE KIND and of LIKE QUALITY to OEM, therefore if you are giving me a motor with 78,000 miles WITHOUT checking any internal operations (valves,guides,pistons,cylinder walls,compression,leakdown,ect, ect, ect,ect) One cannot tell me that they are putting something of like kind and quality anything, it is all speculations and assumptions. The contract does not allow for assumptions and speculation therefore its a farce.

Am I out of line? I only want fairness, and thus an unknown piece of machinery put in my car without any disclosure is unjust and unfair.

Yeah but you can't prove that they aren't giving you a motor of like kind and quality... until they install it and you get it tested and inspected. If that motor is bad, they would have to replace it again, correct? You should check on that. I know that's double the hassle, but you still have options if they install a bad engine. within 6000 miles you should be able to tell if that motor is of like quality.

[Scotty@Advanced]

Hey Tony,

This was one of my original plans, however per Zurich; Shokan does not warrant labor, only parts in their 6 month unlimited mileage warranty. Therefore Zurich denied the request for me to purchase the motor ( Even though it was actually saving Zurich ~1,000 bucks). Doesnt make sense to me, but thats per their policy.

Zurich has a contract with the dismantler that states they will cover the parts and labor of the engine. If the dismantler send a bunk engine they (the dismantler) have to pay for the parts AND the labor to replace it. The price is more because the dismantler is providing coverage against the labor in case shit happens.

I'm pretty sure I know exactly what the O.P. payed for. I payed for the same thing (but different Co.) and went thru almost the exact same situation (different part, same song&dance)...

Point is, the broker/salesman who sells you a warranty that allows the use of used parts as replacements, should fuking tell you instead of having to meticulously read 3pgs (front & back, so 6pgs) of fine details...

Not to mention, the practice shouldn't even be allowed by the governing powers that regulate warranty & insurance Co's...

So moral of this story is:

Don't believe the salesman
Read the freaking contract regardless of it's length
Write your congressman and have the laws changed.

[J0HN_R1]

Zurich has a contract with the dismantler that states they will cover the parts and labor of the engine. If the dismantler send a bunk engine they (the dismantler) have to pay for the parts AND the labor to replace it. The price is more because the dismantler is providing coverage against the labor in case shit happens.





So moral of this story is:

Don't believe the salesman
Read the freaking contract regardless of it's length
Write your congressman and have the laws changed.

Wierd... I cant see the first part of your post ("Zurich has a contract with the dismantler"), but it shows when I quote it...

And as for the "Moral"... Yeah, more or less...

[RAudi Driver]

Alright, everyone seems to be on the same page now. John, I see your point and gotta say, that you can never trust a salesman, period! Contracts are meant to be read. What was the outcome on your situation? Did you get what you fought for?

Scotty, you seem to know some of the ins and outs of the warranty business. Can the op request that only the part that failed be replaced? If the $5,800 cap isn't in the contract, wouldn't it be unenforceable?

OP, first things first. You need to get Zurich to define like kind and quality in regards to your motor. For instance:

1: a motor that runs like a perfectly running 4.2 Audi V8.

2. A motor that runs like a perfectly running 94k mile 4.2 V8.

3. A motor that runs but burns oil.

4. A scored cylinder wall motor that runs.

I think that a compression and leak-down test is in order.

Ask Zurich, what constitutes like/kind in regards to compression and leak-down numbers, then go from there. Don't allow them to toss the motor into your car or you'll be stuck as approving the swap. In California, we have The Bureau of Automotive Repairs, which mediates issues like this for us here in Ca. Do you have something like that in NJ?

[J0HN_R1]

Alright, everyone seems to be on the same page now. John, I see your point and gotta say, that you can never trust a salesman, period! Contracts are meant to be read. What was the outcome on your situation? Did you get what you fought for?

I ended up settling for partial coverage of the cost of an OEM alternator (they covered $500 of the $780). But that was after 2 weeks of fighting with them...



Scotty, you seem to know some of the ins and outs of the warranty business. Can the op request that only the part that failed be replaced? If the $5,800 cap isn't in the contract, wouldn't it be unenforceable?

This is where the "Warranty Co. will repair within reasonable cost" part of the fine-print comes in. They'll say that according to their database, the "average" cost would be $5000 and they're willing to pay $5800, so they're doing you a favour (in their eyes. not ours)...

[RAudi Driver]

Wow, who was, or is, your insurance company? I was thinking about getting an extended warranty but don't trust any of them.

[J0HN_R1]

Wow, who was, or is, your WARRANTY company? I was thinking about getting an extended warranty but don't trust any of them.

First Canadian Protection Plan, backed by Millenium Insurance...

Click on "Time of Sale - Extended Protection", I have the 'Select Plus' coverage. http://www.firstcanadian.ca/warranty.htm

[93hrdtptt]

Well a little update.

After having the most insane day of my life back and forth with this people, they agreed to my original request which was the '05 motor with 30k miles on it from Shokan.

They made up a waiver which basically explained that they were not liable for the request of this purchase, ect ect.

Overall, I feel a lot more comfortable with a 30k motor from Shokan than getting one from their unknown supplier with an undisclosed 78k motor.

[RAudi Driver]

Who is this Shokan I hear of?

[ronaldmcdonald]

http://lmgtfy.com/?q=shokan+audi

[P0234]

Well a little update.

After having the most insane day of my life back and forth with this people, they agreed to my original request which was the '05 motor with 30k miles on it from Shokan.

They made up a waiver which basically explained that they were not liable for the request of this purchase, ect ect.

Overall, I feel a lot more comfortable with a 30k motor from Shokan than getting one from their unknown supplier with an undisclosed 78k motor.

Good deal. Honestly much much worse things happen with lesser warranty companies.

[J0HN_R1]

They made up a waiver which basically explained that they were not liable for the request of this purchase, ect ect...

So does the "etc, etc" part mean they're not on the hook for any further engine-related claims...?

If so, that's bogus... I would never agree to that...

[Scotty@Advanced]

Well a little update.

After having the most insane day of my life back and forth with this people, they agreed to my original request which was the '05 motor with 30k miles on it from Shokan.

They made up a waiver which basically explained that they were not liable for the request of this purchase, ect ect.

Overall, I feel a lot more comfortable with a 30k motor from Shokan than getting one from their unknown supplier with an undisclosed 78k motor.

What if the Shokan motor fails? Do you or Zurich cover the repairs on the second engine? If you then I would have gone with the engine from the other vendor. I've heard of these engines having problems off the showroom floor.

[Scotty@Advanced]

Looks like Shokan isn't as rock solid as they advertise.

http://www.audizine.com/forum/showth...68#post5794168