Rattling under dash front and center

I finally took my car in and the technician drove around with me. He confirmed that the noise was coming from under the dash. After some discussion with his supervisor, he came back and said it was the insulation pads which had broken down and needed replacing. He said this was due to the heat. He told me this involved taking off the dash board and was an all day (8 hour job) of about $800, but they would charge me only half, about $425. I was stunned because I have never had this happen in another car. I use window shield and keep my car in a garage most of the time. It does not sit out all day by any means. So I am looking for solutions before I go back and say that it seems this should be under warranty. I purchased the extended warranty when I bought the car new, but after reading over the packet, it does not seem to cover insulation pads in the dashboard. Has anyone else had this experience? I love the car, but it is really annoying when we are driving around town and have a constant noise from the dash.