Mechanical Breakdown Insurance – What Does It Cover?
Every driver has auto insurance that protects them in the unfortunate event of an accident or collision. In nearly all U.S. states, it is required by law, and it can end up saving you a lot of money by carrying it. However, how often have you actually used your car insurance?
Many people can go through their entire lives behind the wheel and never end up in an accident, yet everyone has insurance. You don’t buy collision insurance so you can start turning the streets into one big demolition derby. You get it because you want to be covered if anything ever happens. While getting into an accident may have never happened to you, we bet something on your vehicle has gone out. With other policies like mechanical breakdown insurance (MBI) or a vehicle service contract (VSC), you’re covered if your car ever breaks down from a mechanical issue. So what exactly does MBI or a VSC cover?
Vehicle Service Contract vs. Mechanical Breakdown Insurance
Will mechanical breakdown insurance cover my navigation? Does mechanical breakdown coverage work for my brakes or the interior of my car?
Before diving into specific questions, it’s important to note that mechanical breakdown insurance is very similar to a vehicle service contract (also known as an extended warranty). A vehicle service contract is a policy that pays for car repair costs in the event of a mechanical breakdown – which is comparable to mechanical breakdown insurance – but there is a difference.
Differences in Coverage
MBI and VSCs are both forms of protection for your vehicle, but they offer different coverage and benefits. MBI is a type of insurance that provides coverage for the repair or replacement of certain mechanical components of your vehicle if they malfunction or break down due to normal wear and tear. This type of insurance typically has an insurance deductible that must be paid before coverage kicks in, and the coverage is usually specific to certain vehicle components.
A VSC is a service agreement that is usually offered by the dealership or third-party provider and covers repairs related to mechanical breakdowns. Unlike MBI, a VSC does not require an insurance deductible and typically provides more comprehensive coverage than MBI. With a VSC, you can expect coverage for parts and labor costs associated with repairing or replacing specific components of your vehicle, including parts not covered by mechanical breakdown insurance. In addition, VSCs often provide additional benefits such as 24/7 roadside assistance, car rental coverage, and travel assistance.
Types of Vehicle Service Contracts
In regards to what exactly is covered under a vehicle service contract, it depends on your level of coverage. Here are the four most common levels of VSC coverage:
Exclusionary: This is the highest level of coverage. With this kind of policy, it lists what isn’t covered (the policy’s exclusions) rather than what is covered. This is because it covers so many parts and systems; it is easier to list what is NOT covered rather than what IS covered.
Stated Component: This coverage is the second highest level. These contracts work the opposite way of exclusionary, where they list what is covered rather than what is not. This form of coverage will cover major components such as the engine and transmission. It will also cover electrical items and other necessary components.
Powertrain: Similar to the stated component level of coverage, it specifically only covers what is referred to as the drivetrain. This typically includes the engine, transmission, and drive axle. These are the three most expensive parts of a vehicle.
Wrap: When your powertrain is still covered by the manufacturer, wrap coverage can cover the rest, making your coverage exclusionary. In essence, wrap + factory powertrain = exclusionary coverage.
Mechanical Breakdown Insurance
Mechanical breakdown insurance, also called car repair insurance, is a type of auto policy specifically designed to cover repairs due to mechanical failure – only in the state of California. It is an optional form of coverage, and it will cover the costs associated with the repair or replacement of any mechanical or electrical parts of the car that fail due to normal wear and tear.
An MBI policy covers any necessary repairs or replacements of a vehicle’s major components, such as engines, transmissions, and certain electrical and electronic components. It also covers repairs to the radiator, fuel and exhaust systems, brakes, and suspension systems. MBI does not cover damage caused by an accident, misuse, or abuse, and it does not cover the cost of routine maintenance such as oil changes.
MBI typically comes with a deductible up front, which is the amount of money the policyholder is responsible for paying out of pocket before the insurance coverage kicks in.
In California, MBI coverage can be offered as an add-on to a regular auto insurance policy by car insurance companies, and its cost varies depending on the policyholder’s driving record and other factors. MBI can also be obtained through third-party providers such as Endurance. Generally, the price of MBI is higher than the premiums for regular auto insurance, but it can provide peace of mind and financial security if the unexpected happens.
Endurance Offers Mechanical Breakdown Insurance
Just like you wouldn’t drive without insurance from Geico or another big-name provider, you shouldn’t go anywhere without Endurance. We offer mechanical breakdown insurance policies for California residents and vehicle service contracts in most other states.
Some providers will assure you your used car will be covered by a mechanical breakdown policy, but you can also take advantage of a trial run with Endurance to find out yourself. Utilize our 30-day waiting period and money-back guarantee to sign up for coverage that works for your needs and budget. In addition, our policies come with flexible payment plans, and you get the freedom to select any ASE Certified repair shop or mechanic for your covered repairs.
Call us today at (800) 253-8203 to get your free quote, or shop online for coverage. You can also visit the Endurance blog for more articles about mechanical breakdown insurance, extended car warranty comparisons, and auto expert tips.
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Alex has worked in the automotive service industry for over 20 years. After graduating from one of the country’s top technical schools, he worked as a technician achieving a Master Technician certification. He also has experience as a service advisor and service manager. Read more about Alex.