What is Mechanical Breakdown Insurance?

Giulia Nigrini
Giulia Nigrini
Vehicle Service Contract Specialist, Traveler, Car Enthusiast
January 3, 2022
min. read
car broken down on the side of the road in the desert

In a nutshell, mechanical breakdown insurance covers critical mechanical components of your car in the event of a failure.  The most common way of taking out mechanical breakdown insurance is as an add-on service when you purchase a new car. And do keep in mind that your warranty is different from mechanical breakdown insurance. So let’s jump into the question: what is mechanical breakdown insurance?

What does mechanical breakdown insurance cover?

Mechanical breakdown insurance typically only covers the most critical parts of your vehicle such as the drivetrain, fuel system, and brakes. This additional insurance most often covers parts that are outside of your factory car warranty.

Not all cars qualify for mechanical breakdown insurance. Your vehicle has to be under warranty to be considered. For companies like GEICO your car must be less than 15 months old and have less than 15,000 miles on the odometer in order to qualify. The purpose of this insurance is to cover parts not described in your warranty plan and be in place before the end of your warranty in anticipation of its termination.

What is not covered by mechanical breakdown insurance?

Keep in mind that mechanical breakdown insurance is an add-on to your basic insurance to cover mechanical parts for new vehicles. This means things like accidents, theft, fire, routine tune-ups, tire-related issues, and damages caused by poor maintenance.

What does mechanical breakdown insurance cost?

Mechanical breakdown insurance cost is relatively low. They range from $40 to $100 per year and generally last up to 7 years or 100,000 miles, whichever comes first. The deductible on these plans is higher than most and ranges between $250 and $400.

What is the difference between an Extended Car Warranty and Mechanical Breakdown Insurance?

Unlike mechanical breakdown insurance, an extended car warranty is a vehicle service contract designed to act as an extension to your manufacturer warranty. In some cases, possibly better than the manufacturer warranty. Extended car warranties can be obtained for older and newer vehicles providing coverage for a number of miles or years.

While also providing extra benefits such as roadside assistance and tire coverage. Making them ideal for used car purchases or vehicles with higher mileage. Mechanical breakdown insurance simply doesn’t accommodate vehicles that are already in circulation. It merely provides extra protection on a newly bought vehicle.

Have a look at the warranties available for your make and model.

Is an Extended Car Warranty a Good Option for You?

Costs like maintenance and windshield repairs are a big part of car ownership. Sometimes these repairs can be expensive. On the more costly side are those repairs needed after a mechanical breakdown.

Auto repair costs can range between $300 and $5,000 depending on the damaged area and the vehicle you are driving. It can be very stressful to manage these unforeseen bills and sometimes lead to unnecessary delays. An extended car warranty can help to alleviate that stress. If you do not have the possibility to keep upwards of $1,000 set aside for unforeseen auto repairs, an extended car warranty is worth it. A warranty plan will ensure that parts and labor are covered in the event of a mechanical problem. Find more details about extended car warranties under our blog.

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