What Is Mechanical Breakdown Insurance?
Mechanical breakdown insurance isn’t a legally required type of auto insurance coverage, but is it a good idea to purchase for your peace of mind?
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Key Points:
- Mechanical breakdown insurance is a type of coverage that pays to repair car parts after your vehicle suffers from a mechanical failure. Unlike traditional car insurance coverage, it doesn’t cover damages from a car accident.
- Unlike extended car warranties, mechanical breakdown insurance is subject to regulation by state insurance commissioners and only available for new vehicles.
- In our review of the best extended warranty and car insurance providers, we feel that Geico and Progressive are solid picks for MBI coverage and Endurance and Carchex offer excellent extended warranty plans.
Some providers offer mechanical breakdown insurance, but it’s not a common insurance product. In fact, a mechanical breakdown insurance policy is more similar to an extended warranty or vehicle service contract than it is to liability or collision insurance coverages.
In this article, you’ll learn everything you need to know about mechanical breakdown insurance–including what it covers, what it costs, and where to buy it. We’ll also introduce a few of the best extended car warranty providers for further coverage options.
What Does Mechanical Breakdown Insurance Cover?
Mechanical breakdown insurance (MBI) is a type of insurance for car repairs. Unlike standard auto insurance policies such as liability insurance, MBI doesn’t cover you after an accident. Instead, MBI covers repairs for car parts that break down after a mechanical failure.
It doesn’t always take a wreck to make your car stop working. Even well-maintained car parts fail over time. If your transmission suddenly goes out, a typical car insurance policy won’t pay to replace it. Mechanical breakdown coverage can come in handy by covering the cost of repairs for specified vehicle components. In this way, MBI coverage is similar to an extended warranty.
Keep in mind that used cars don’t have eligibility for MBI coverage, as it’s typically only available for cars younger than 15 months with fewer than 15,000 miles.
Mechanical Breakdown Insurance Exclusions
Parts covered by an MBI policy can vary by provider. The most comprehensive policies will cover repairs on nearly all vehicle parts, with only a few exclusions. Items that are not commonly covered under mechanical breakdown insurance include:
- Wear-and-tear items like brake pads and wiper blades
- Non-mechanical or electrical parts like glass, upholstery, and exterior trim
- Damage and malfunctions caused by misuse, abuse, or neglect
- Routine maintenance services like oil changes
- Damage from improper maintenance or the installation of aftermarket components
Do I Need Mechanical Breakdown Insurance?
Unlike liability car insurance, mechanical breakdown insurance is never required by state law. Purchasing some form of extended protection like mechanical breakdown insurance is more for peace of mind when it comes to paying out-of-pocket for costly repairs.
The reality is that every vehicle will need repairs at some point, and drivers should budget for these costs. You can either save for the cost of repairs on your own or purchase extended vehicle protection like mechanical breakdown insurance.
Of course, there are pros and cons to each option. For example, if your vehicle doesn’t experience a covered failure and you don’t use your mechanical breakdown insurance, you’ll have paid for unneeded coverage. However, if your vehicle suffers from a particularly costly mechanical problem, an MBI policy can help safeguard you financially.
Mechanical Breakdown Insurance Vs. Extended Car Warranties
Mechanical breakdown insurance is offered by a few insurance providers, but most companies offer a different product known as an extended car warranty (also called a vehicle service contract or vehicle protection plan).
An extended car warranty is similar to mechanical breakdown insurance. It’s an optional contract promising to pay the cost of repairs should a covered component break down after normal use. Like MBI policies, extended warranties don’t cover damage as a result of a car accident or misuse, and companies have strict requirements for keeping coverage valid.
The main difference between the two protection plans is that mechanical breakdown insurance is legally considered an insurance product, so it’s subject to regulation by each state’s insurance commissioner. This standard makes some drivers feel more comfortable purchasing MBI policies, but there are plenty of reputable extended car warranty companies as well.
For further clarity, we’ve outlined the differences between mechanical breakdown insurance and extended car warranties in the table below.
How Much Does Mechanical Breakdown Insurance Cost?
The cost of mechanical breakdown insurance depends on your provider, vehicle, and driving record. Like car repair insurance, there isn’t one set rate. The best way to find out how much this insurance costs is to get a quote for coverage for your specific car.
Keep in mind tha, because mechanical breakdown coverage is usually purchased when you buy a new car, you may end up paying for coverage long before you use it. New vehicles are already covered by a manufacturer’s warranty, so an MBI policy provides little to no extra protection while your factory warranty is still in effect (typically for 3 years/36,000 miles).
Vehicle service contracts are often more expensive and have up front costs, but coverage can be purchased at any time, so you can wait until after your manufacturer warranty has expired to buy coverage.
Who Has The Best Mechanical Breakdown Insurance?
Not every car insurance company offers mechanical breakdown insurance. Among top insurers, we found Geico to be one of the few that provides MBI coverage.
Note that there is no single best mechanical breakdown insurance provider for every driver. If you have a newer car that’s insured by a company that offers MBI, it’s worth checking out policy details to see whether the coverage is right for you.
Geico: Best For Basic Coverage
Geico is one of the largest and best-known insurers in the United States. In our industry-wide review, we found that Geico offers great rates for basic coverage. If you’re looking for mechanical breakdown insurance and are already a Geico customer, it’s worth it to get a quote. Geico customers can save on an MBI policy by bundling it with their existing insurance products.
Geico’s strong customer service reputation along with its simple claims process and nationwide availability make it one of our top recommended insurers. Geico reviews are mostly positive, and the company holds an A+ rating and accreditation from the Better Business Bureau (BBB).
A Geico MBI policy can be purchased for new or leased cars that are less than 15 months old and have fewer than 15,000 miles on the odometer. This policy can be renewed for up to 7 years/100,000 miles. All Geico mechanical breakdown insurance policies come with a $250 deductible.
To find out more about this provider, check out our full Geico insurance review.
Progressive: Best For Usage-Based Insurance
Progressive is another heavyweight in the insurance industry, and is the third-largest auto insurer in the nation. Progressive is a great pick for usage-based insurance thanks to its Snapshot® program that rewards you for good driving habits. It also offers mechanical breakdown insurance that’s worth looking into if you’re a Progressive policyholder.
You can purchase MBI coverage for cars, trucks, SUVs, and RVs with Progressive. We like how the insurance giant allows you to take your car to any repair facility you’d like, no matter where you break down. Plans also come with travel benefits and rental car reimbursement.
Progressive offers your choice of a $100, $250, or $500 deductible with its MBI plans depending on your budget and vehicle type. You can also choose to pay annually, monthly, or as-you-go.
Learn more about the company’s offerings in our Progressive insurance review.
Who Has The Best Extended Warranty?
If you have an older vehicle or if you don’t already have coverage from a company that sells MBI policies, you may be better off going with a vehicle service contract from a warranty company. Learn more about Endurance and Carchex–two top-ranking providers in our industry wide review–in the sections below.
Endurance: Best Overall
Endurance sells vehicle service contracts that pay to repair or replace certain vehicle parts should they break down from normal use. Endurance is one of our top-rated extended auto warranty providers because it offers such comprehensive coverage options. Customers can choose from six plans:
- EnduranceAdvantage™: Covers mechanical breakdowns as well as maintenance, like oil changes, engine diagnostics, and brake pad replacements.
- Supreme: Bumper-to-bumper warranty protection that covers nearly all mechanical and electrical parts of your vehicle
- Superior: Covers all components included in the Secure Plus plan, as well as the cooling system, suspension, and fuel system
- Secure Plus: Covers everything in the Secure plan, and adds coverage for the air conditioning, brake components, and steering
- Secure: Covers parts of the engine, transmission, and drivetrain
- Select Premier: Plan designed especially for high-mileage vehicles that covers most powertrain components
Benefits that come with an Endurance plan include roadside assistance, towing, rental car reimbursement, trip interruption benefits, and one free year of Endurance Elite benefits. The provider also lets you take your car to any ASE®-certified repair shop for covered repairs.
Read our Endurance warranty review for more information, and reach out for a free quote below.
Carchex: Best Industry Reputation
Carchex is another vehicle service contract provider that offers coverage similar to mechanical breakdown insurance. The company has a consistently positive online reputation, earning an A+ from the BBB and endorsements from companies like Kelley Blue Book, RepairPal, and Edmunds.com.
We rate Carchex highly for customer service because of its shining reputation and its wide range of support channels, including 24-hour live chats and assistance via telephone and email. Easy access to contract administrators quickens the claims process, and Carchex makes sure that customers can have claims approved as soon as possible.
Learn more about the provider and its five types of coverage in our comprehensive Carchex review. You can also click below to get a free, personalized Carchex quote.
Mechanical Breakdown Insurance: FAQ
Below are some commonly asked questions about mechanical breakdown insurance.
What is mechanical breakdown insurance?
Mechanical breakdown insurance is an add-on coverage that you can buy from insurance providers. It covers the cost of vehicle repairs after mechanical failures from normal use. It doesn’t cover damage from car accidents or vehicle abuse and neglect.
How does mechanical breakdown insurance differ from an extended warranty?
The main difference between mechanical breakdown insurance and extended warranty coverage is that MBI plans are legally considered insurance products. Because of this, they are subject to regulation by your state’s insurance commissioner.
What does mechanical breakdown insurance typically cost?
There is no set cost for mechanical breakdown insurance across providers. Like regular car insurance, the cost of MBI coverage depends on factors like your vehicle make and model as well as your driving record.
How We Rate Auto Insurers
Our review team extensively researches auto insurance providers to deliver informed and unbiased assessments of leading companies. We evaluate several key rating factors that are important to consumers to determine which providers are the best in the industry:
- Reliability: It’s important that an auto insurer is able to meet its claims obligations. Companies with a strong financial strength rating from AM Best score best in this category. Established insurers with a long history of reliable service also receive positive marks.
- Availability: Insurance companies that offer wider availability to consumers in terms of state availability and few eligibility requirements are more likely to meet consumer needs.
- Coverage: To determine our coverage score, we look at the number of coverage options available as well as coverage limits and deductible options. Our ratings also take into account additional services and benefits like roadside assistance.
- Pricing: Cost can be difficult to compare between insurers because so many factors impact annual premiums. The cheapest insurer for one driver may not be the cheapest for another. To determine our cost score, we look at insurance rate estimates generated by Quadrant Information Services, discount opportunities, and consumer reports.
- Service: We comb through customer reviews on sites like the Better Business Bureau (BBB) to learn about customer experiences. Insurers with a low volume of complaints score well in this area. We also consider the claims process, giving higher ratings to car insurance providers that offer a smooth experience.
- Technology: Providers with an online quote tool, easy-to-use claims app and a usage-based insurance app score best in this category.
