AA Auto Protection Warranty company refuses to pay for parts covered thrugh Warranty west Deptford, New Jersey

I purchased AA Auto Protection on 05/10/2011 for $2460.00. I contacted the company regarding a repair for my A/C Compressor that went bad on 09/2012. This is a covered part through my warranty contract. I called the warranty company several times and finally I was told the the company did not have funds to pay for any warranties. I was also told that this was effective as of April , 2012. In the Interim I have to pay for repairs of my vehicle in the amount of over $1400.00, This is the reason that I purchased the warranty, for a peace of mind to avoid unexpected problems with my vehicle.  Now I am getting the run around from the company. I plan on taking legal action regarding this issue. I strongly advise everyone to avoid using this company for anything! can someone help me or have had similar issues.