Mechanical Breakdown Insurance

Protect your car from costly mechanical failures not covered by standard insurance.

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What is mechanical breakdown insurance coverage?

Mechanical breakdown insurance (MBI) is an optional add-on that helps cover costly repairs for major mechanical failures unrelated to accidents. Unlike standard auto insurance, which won’t cover a failing transmission or broken AC, MBI steps in for these big-ticket repairs. It works similarly to an extended warranty, protecting essential parts like the engine, brakes, and power system.

Since MBI isn’t included in a typical policy, it’s worth considering whether it fits your vehicle’s reliability, budget, and comfort with out-of-pocket repairs. Let’s dive into the pros and cons and which companies offer this coverage.

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Is car repair insurance the same as mechanical breakdown insurance?

There’s no single policy called “car repair insurance”—it’s a general term for any coverage that helps pay for vehicle repairs. Mechanical breakdown insurance (MBI) is one option, along with collision and comprehensive coverage, which cover damage from accidents and external events. However, collision and comprehensive don’t cover mechanical failures, like drivetrain issues, while MBI does.

Covered repairs are outlined in your policy, so check with your insurer to see what’s included or if additional protection can be added. Whether car repair coverage is right for you depends on factors like your car’s age, warranty, and budget. It could be a worthwhile investment if it helps reduce out-of-pocket repair costs.

tow truck


What does mechanical breakdown insurance cover?

Mechanical breakdown insurance covers vehicular damage occurring outside of a car collision. Much like comprehensive or collision coverage, MBI is subject to variable deductibles. For mechanical breakdown insurance to provide coverage, the value of repair costs needs to be greater than the policy's deductible. A typical mechanical breakdown deductible is $250.


Typically, the following parts can be covered by MBI:

  • Engine
  • Transmission
  • Exhaust
  • Air conditioning
  • Technical components, computer

What is not covered?

  • Tune-ups
  • Oil changes
  • Tire repair or rotation
  • Intentional damage
  • Damage caused by misuse
jumper cables
Does Insurance Cover a Blown Engine?

For most of us, a smoking engine is more of a panic-inducing nightmare than an action movie stunt. If your car suddenly gives up on you mid-drive, your first step should be to pull over safely, call for roadside assistance, and then check with your insurance provider.

Unfortunately, a blown engine can be an expensive fix. However, certain types of insurance may help—depending on what caused the damage. If engine failure is due to an accident, comprehensive or collision insurance might cover it. And if you have mechanical breakdown insurance, you could be in luck for repairs unrelated to everyday wear and tear.

The key factor is maintenance—if you’ve kept up with regular service and your engine still fails due to a covered event, your insurance may help foot the bill.


How much does mechanical breakdown insurance cost?

MBI can cost around $100 a year, but the price varies depending on your provider and car — its make, model, mileage, etc. So, if you have an electric car, you’ll pay a different rate than someone with a Toyota Corolla or a Ferrari. But remember that MBI often comes with a high deductible, which means the policyholder (you!) may end up paying out-of-pocket for many expenses. 

The cost of MBI varies depending on the insurer and the vehicle but is typically more affordable than extended warranties offered by dealerships. For instance, GEICO's MBI charges a small premium per policy period instead of a large lump-sum payment upfront.


Mechanical breakdown insurance vs. extended warranty

Most new vehicles come with a car warranty lasting one to three years. An extended warranty is exactly what it sounds like — it extends the vehicle's warranty beyond its original expiration date. While details may vary based on the dealership and the vehicle, mechanical breakdown insurance may overlap with an extended warranty.

A few key differences exist between mechanical breakdown coverage and an extended warranty. MBI allows you to choose the repair facility you'd like to use — with an extended mechanical warranty, you must use the approved repair facility for the warranty to cover the costs. Another difference includes the way you pay for and purchase the products. Extended warranties are often paid for with lump sum fees and can be relatively pricey up front. Mechanical breakdown insurance costs are added to insurance premiums as a monthly fee.

car warranty

Do all insurance companies offer MBI?

Not all insurance companies offer Mechanical Breakdown Insurance (MBI) because it’s costly, less in demand, and faces tough competition. Big repairs like engine or transmission failures can be expensive for insurers to cover, making MBI a risky option for some. Plus, many new cars already come with manufacturer warranties, so drivers may not need extra coverage right away. On top of that, dealerships and third-party companies dominate the extended warranty market, so traditional insurers are less likely to offer MBI as part of their policies.


Which companies offer mechanical breakdown insurance?

car
GEICO mechanical breakdown coverage

GEICO is one of the biggest providers of mechanical breakdown insurance. GEICO's mechanical breakdown coverage is for new or leased vehicles with less than 15,000 miles, purchased within the past 15 months. Once you have this coverage, it may remain active for up to seven years or 100,000 miles.

Below are the damages covered and not covered by GEICO’s mechanical breakdown insurance.


Covered damage:
  • Cooling systems
  • Suspension
  • Steering
  • Transmission
  • Drive axle engine
Not covered:
  • Regular maintenance services such as changing brake pads, spark plugs, air filters, tires, or tune-ups, suspension alignment, and wheel balancing.
  • Any damage that is intentionally caused or caused by misuse
GEICO mechanical breakdown cost:

The cost of MBI will depend on the value of your vehicle. As such, GEICO does not advertise standard mechanical breakdown coverage costs. Although independent sources claim GEICO's coverage is expensive, GEICO states its MBI costs “pennies per day.”


 

insurance policy
Mercury mechanical breakdown coverage

Mercury Insurance offers its own MBI plan, called Mercury Mechanical Protection. This operates like an extended warranty, with a few tiers of coverage. Mercury's platinum plan has the highest level of coverage, covering nearly all mechanical and electrical claims. Below is what is included in each tier.

Coverage Option Gold Silver Copper
Engine failure Yes Yes Yes
Transmission and transfer case Yes   Yes
Drive axle Yes   Yes
Steering Yes Yes  
Brake Yes Yes Yes
Suspension Yes Yes  
Electrical Yes Yes Yes
Fuel system Yes Yes  
Air conditioning Yes Yes Yes
Audio center Yes    
Hardware Yes    

The platinum eliminates any exclusions from the gold, silver, and cooper plans. In addition to the coverage above, Mercury also offers the following coverage options:

  • 24/7 roadside assistance
  • Rental vehicle assistance
  • Tire protection
  • Trip interruption coverage
  • Auto deductible reimbursement (platinum only)

 

car keys
USAA mechanical breakdown insurance

Managed and serviced by Assurant Solutions, USAA’s option for MBI is called Extended Vehicle Protection. While less specific about its coverage option than GEICO, USAA’s MBI program applies to the failure of a covered fault under normal and usage of the vehicle. There are three main qualifications your vehicle must meet:

  • The vehicle needs to be younger than 10 years old
  • Less than 250,000 miles
  • Be covered under its original dealership warranty

Although they do not specifically state what is and is not covered, Assurant and USAA program offers additional coverage such as roadside assistance, car rental services, and overnight expenses. This is in addition to their mechanical breakdown coverage options.

Once your vehicle’s original dealership warranty expires, you will no longer be eligible for USAA’s MBI coverage. Because it is managed by Assurant rather than USAA, you will be dealing with their customer service and claims team. Assurant does not state how much this coverage will cost.



Is mechanical breakdown insurance worth it?

That is up to you. If you want additional peace of mind MBI could be worth the cost.

Consider the following before purchasing a mechanical breakdown policy:

  • How much does this coverage cost compared to the out-of-pocket cost?
  • Will filing an MBI claim increase my premium?
  • Does my company offer this or is it through a third party?
  • Is my existing warranty sufficient?

The best way to answer these questions is to contact an insurance agent. Do your research to learn if this optional policy is one you should consider. If you’re looking for further information related to optional coverages and car insurance, see below.

If you want to see quotes from different companies based on your driving profile, enter your ZIP code below!

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FAQs

Maybe—but it depends on your policy and what caused the engine to blow. If it’s from an accident, you might be covered. But probably not if it’s due to neglect or wear and tear. Check your policy to be sure!

Mechanical breakdown insurance (MBI) helps pay for unexpected car repairs that aren’t caused by accidents or normal wear and tear. It typically covers major parts like the engine, transmission, electrical system, and steering. After you pay your deductible, your provider covers the rest of the repair cost.

MBI won’t cover things like oil changes, brake pads, or tires—those are considered regular maintenance. Coverage details vary, so check your policy to see what’s included.


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