It is a limitation of the Bluetooth Hardware involved. I've used different headsets with the same phone and some work and some don't.
Hi, the consensus I have got so far is that it is an issue with the software. This feature did work for others previously but was removed around 3.7.5 (if that version exists...). Either that or the application just broke for this around then. Unfortunately I can't check this as I currently see no way to get an older version of the application for iOS 7.
I am guessing my bluetooth should work as it uses the HFP profile which I guess is pretty standard, as well as A2DP. I do believe that HFP profile is used for Waze though...
Please correct me if I am wrong though as fairly new to using the Waze application day to day. Thanks.