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MBI in California: How It Can Complement Your Car Insurance Policy

POR: David Goldberg
Downtown Oakland California and Lake Merritt

Owning and operating a vehicle involves many ongoing costs. From monthly payments and gas to regular upkeep and surprise repairs, keeping a car on the road requires a serious financial commitment. Also among these costs is traditional car insurance, a requirement under California law.

While standard insurance policies may protect against collision damage, theft, vandalism, and other hazards, gaps remain for some car owners. Mechanical breakdowns fall into this unprotected territory. Fortunately, California drivers can be protected against coverage shortfalls through mechanical breakdown insurance (MBI).

Mechanical breakdown insurance delivers targeted coverage for critical vehicle components vulnerable to failure. Pairing MBI with traditional car insurance safeguards owners against unexpected out-of-pocket repair costs.

Keep reading as we explain what mechanical breakdown insurance involves, specifically in California, where policies must adhere to stringent state insurance regulations. You’ll also learn how MBI complements standard car insurance, covering repairs unrelated to accidents and other mishaps.

Understanding MBI in California

While mechanical breakdown insurance has existed nationally for decades, the policy type has a special designation in California. The California Department of Insurance (CDI) oversees MBI as a regulated insurance product. This means MBI sellers must secure proper licensing and meet financial stability standards before operating within the state.

So why does California regulate mechanical protection as an insurance product rather than just a product warranty? Basically, because regulators want to ensure consumers are fully protected.

Like an insurance policy, MBI offers guaranteed coverage for vehicle repairs, requiring one-time or ongoing premiums in exchange for stated financial protections. However, similar to a product warranty, this protection aims specifically at mechanical and other complex vehicle components, which face inevitable wear as automobiles age and accumulate miles.

Due to covering vital systems beyond what factory warranties provide, California designates MBI as insurance. As an insurance product, rigorous regulations ensure providers can pay claims while offering reasonably priced and easy-to-understand MBI policies.

This oversight gives California drivers confidence in purchasing quality mechanical breakdown coverage compared to extended warranties (sometimes called vehicle service contracts or auto protection plans). Most other states don’t regulate extended warranties as extensively.

MBI vs. Extended Warranties

Given similarities in protecting against mechanical repairs, understanding the key differences between mechanical breakdown insurance and extended warranties is essential for car owners:

  • Legal Matters: Except for state-licensed car dealers, third-party companies cannot legally sell extended warranties or vehicle service contracts in California. Only approved MBI plans sold through a licensed provider constitute legitimate mechanical coverage in the state. In other words, it’s a lot easier for extended warranty companies to set up shop in other states than in California.
  • Regulations: In addition to strict licensing requirements, California’s insurance regulations mandate that MBI providers maintain large fund reserves or purchase secondary insurance to guarantee enough resources to pay policyholder claims. Further, the CBI reviews all MBI policies and rate plans before a consumer can buy them.
  • Transparency: California regulations stipulate that MBI policies are free of confusing legal jargon, misleading sales tactics, and unclear conditions. All terms outlined in writing must be clear, concise, and straightforward for the average consumer.  The state even mandates the size of the typeface — there’s no such thing as “fine print” in a California MBI insurance policy.

So, while MBI coverage may look and act like an extended car warranty on the surface, deep down, it’s a highly regulated insurance product in California. Further, mechanical breakdown insurance provides peace of mind when dealing with a factory warranty that’s ending or already expired.

MBI coverage can vary by plan, but covered systems often include the engine, transmission, drivetrain, electrical, air conditioning, suspension, and electronics. MBI policies are usually offered in tiers, allowing car owners to balance protection level and cost.

Complementing Your Car Insurance Policy with MBI

While seguro averia mecanica delivers focused protection against mechanical and other complex repairs, standard automobile insurance covers altogether different hazards. This makes the two policies perfectly complementary.

Standard insurance encompasses damages from collision, theft, vandalism, and weather-related incidents (like fire or flooding). Necessary repairs from those unfortunate vents fall under a car insurance policy’s collision or comprehensive coverage.

In comparison, mechanical breakdown insurance handles vital component failures due to defects in manufacturing or workmanship. For instance, a malfunctioning engine due to a defective piston cylinder might be covered under an MBI policy. This type of event stems from an issue with a component rather than an external force (like an accident). As a result, a claim for component failure can’t be made under a traditional auto insurance policy.

So, MBI coverage paired with standard car insurance provides 360-degree protection. The idea is that with both policies in place, car owners are protected against most mishaps, regardless of the origin.

Let’s look at practical examples of claims for regular auto insurance and mechanical breakdown insurance:

Incident Covered by Auto Insurance Covered by MBI
A collision causes dents, scratches, and side-mirror damage after being sideswiped in a parking lot.
The car won’t shift out of park due to a defective first gear.
A tree branch falls on a car during a storm, damaging the roof and hood.
A wiring harness failure leads to electrical “gremlins.”
A driver without insurance hits a car, damaging the fender and trunk lid.
The air conditioning compressor fails.
Following a collision, the other motorist’s coverage is insufficient to pay for injuries and repairs.
The power steering pump no longer functions properly.

Actual coverage is determined by the policy terms in place during the incident. For example, California regulations require car owners to have liability insurance, but other protections (such as collision, comprehensive, and underinsured/uninsured motorist) aren’t mandated. You can only make a claim outside of basic liability protection if you have applicable insurance.

Likewise, mechanical breakdown protections start with a powertrain policy that covers the engine, transmission, and drive axle. To be protected beyond the powertrain, you’ll need an expanded MBI policy.

Financial Protection and Peace of Mind

A significant advantage MBI delivers is financial protection from expensive car repairs. Are you prepared to pay $1,000 for service work? What about $5,000?

Let’s look at repair estimates for a 2015 Toyota Camry in select California cities (cost information is courtesy of RepairPal).

Repair Amount Location
Transmission Replacement $6,526 to $7,034 San Diego
Water Pump Replacement $603 to $769 Los Angeles
AC Compressor Replacement $1,847 to $2,263 San Francisco
Rack and Pinion Replacement $2,502 to $3,295 San Jose
Camshaft Replacement $1,108 to $1,277 Fresno

Without MBI coverage, an owner can be on the hook for thousands of dollars in potential service work. And these amounts are for a Toyota Camry, a vehicle known for reasonable repair costs. With mechanical breakdown insurance, responsibility for covered repairs shifts to the MBI provider, not the car owner (the policyholder still pays for any deductible and uncovered work or parts).

Drivers most likely to benefit from MBI include:

  • Owners of high-mileage vehicles (up to 150,000 miles) that no longer have a factory warranty
  • Buyers of used cars without remaining bumper-to-bumper manufacturer coverage
  • Owners of vehicles anticipating high-mileage use
  • Individuals without ample savings to afford surprise repairs

Of course, peace of mind with MBI goes beyond avoiding expensive repair bills. It also means less stress in the event of a breakdown. All Endurance Warranty MBI policies provide towing and rental car reimbursement when covered repairs are involved. Trip interruption protection is also included. Need help locating an Mecánico certificado ASE or shop? Endurance customer service is ready to help. In other words, you’re not alone with an MBI policy from Endurance.

How Endurance Warranty Fits In

Supplementing your regular car insurance with an MBI policy requires picking the right provider. Founded in 2006, Endurance Warranty has served over one million car owners nationwide while receiving high customer satisfaction scores. More importantly, Endurance stands behind its commitments, paying hundreds of millions in claims since 2012.

Endurance’s customer-centered approach includes offering tiered MBI coverage levels, enabling California drivers to find protection tailored to their budget, vehicle, and ownership goals. Endurance customers can further customize coverage with a choice of term lengths and deductible amounts.

Endurance policyholders also experience a streamlined claims process. Thanks to a dedicated in-house claims department, covered repairs can be approved rapidly, helping drivers get back on the road as soon as possible. Support is available by phone or electronically.

Endurance MBI Goes Beyond Regular Car Insurance

From Crescent City to San Diego, California car owners can go beyond ordinary car insurance by adding MBI coverage. It’s supplemental protection against breakdowns and surprise repair bills.

Endurance offers customizable MBI coverage options – with better benefits than the competitors. Enjoy perks like roadside assistance/towing, rental car coverage, trip interruption reimbursement, and an exclusive mobile app.

Learn about your mechanical breakdown insurance options by requesting a FREE quote or visiting our tienda en línea. You can also call (800) 253-8203 for personalized help from an Endurance advisor.

Explore our auto blog for valuable articles about vehicle maintenance, frequently asked questions (FAQs), DIY repairs, MBI advice, car reviews, and more.

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