Auto Repair Insurance Explained

Auto repair insurance is a type of coverage that protects you financially in case your vehicle breaks down or is damaged in an accident. There are several types of auto repair insurance policies, including collision, comprehensive, and liability coverage.

Collision coverage pays for repairs to your vehicle if you're involved in an accident, regardless of who's at fault. Comprehensive coverage, on the other hand, covers damage to your vehicle from non-collision events, such as theft, vandalism, or natural disasters.

Liability coverage is required by law in most states and pays for damages to other people or property in the event of an accident. This type of coverage is usually the most affordable option, but it's still an essential part of any auto insurance policy.

Auto repair insurance is a service offered to fix minor and major mechanical failures due to normal wear on your car.

You can add car repair insurance to your current auto insurance policy to help pay for repairs that aren't accident-related.

Car repair insurance is also sometimes known as mechanical breakdown insurance, or MBI for short.

Not all car repair insurance policies are created equal, and coverage can vary depending on the insurer you choose.

Eligibility requirements for car repair insurance vary from one company to the next, so it's essential to check with your provider to see what's available.

Car repair insurance can be a lifesaver when your vehicle breaks down unexpectedly. It removes the uncertainty over future car repair costs, allowing you to budget for predictable payments.

You can avoid spending hundreds or even thousands of dollars in the event of a malfunction or breakdown, which can be a significant financial burden.

The cost of car repair insurance is relatively low, making it a worthwhile investment for many car owners.

Car repair insurance is a type of protection that covers the costs of repairing or replacing your vehicle's mechanical systems after you've paid the deductible, which can range from $50 to $250.

The policy usually includes repairs to engines, transmissions, drivetrain, air conditioning and heating systems, safety technology, and other components.

You'll need to contact your repair insurance provider to file a claim, which will allow you to ask for pre-authorization for your repairs.

Once your claim has been approved, you can go to an authorized mechanic for the repair.

Some car insurance companies may require you to visit specific locations for repair.

Here are some of the components that are typically covered by car repair insurance:

You can also purchase optional add-ons, such as roadside assistance and rental car reimbursement insurance, to cover other costs related to car repairs.

These add-ons can pay for repairs when you're stuck on the road, including changing a flat tire, jump-starting a dead battery, or getting a tow truck.

The rental car reimbursement insurance can help pay for the cost of a rental vehicle when your car is being fixed after an accident or another covered event.

Car repair insurance can be a lifesaver if you're not prepared for unexpected car troubles. You can get it for as low as $200 per year, which is rolled into your car insurance premiums.

GEICO's Mechanical Breakdown Insurance (MBI) is a popular option, with a $250 deductible and limited coverage terms. This might be less expensive than other forms of car repair insurance.

Most car repair insurance plans cover some combination of brakes, exhaust, steering, drivetrain, heating and cooling, and engine parts like the water pump.

The cost of car repair insurance varies depending on your vehicle, its condition, and the company you use. You can expect to pay between $50 and $100 for a deductible, depending on your service contract.

Here's a rough breakdown of what you can expect to pay for car repair insurance:

Keep in mind that these costs are for specific plans and vehicles, and your cost will vary based on your own car's make, model, mileage, and age.

If you're looking for a more affordable option, you might consider a third-party extended warranty. These can be purchased for older cars, typically at higher rates than those for newer vehicles.

If you're not sure about car repair insurance, consider these alternatives: you can save money by putting aside the funds you'd spend on car repair insurance or an extended warranty into a savings account. This way, you'll have a cushion for potential future repairs.

There are a few ways to reduce the likelihood of costly repairs in the first place. Following the maintenance schedule in your owner's manual is a great way to keep your car in good shape.

If you're shopping for a new or low-mileage used car, ask your insurance company for a quote on car repair insurance, if available, before you go to the dealership. This will allow you to compare rates when the salesperson offers the dealer's extended warranty.

You can also consider the following factors when deciding whether car repair insurance is worth it for you:

If your vehicle has advanced safety and convenience features, it may be worth considering car repair insurance, especially if you plan to keep the car for a long time. You'll want to weigh the cost of the insurance against the potential savings on repairs.

If you have a basic vehicle with standard safety features and limited technology, car repair insurance might not be necessary. This is because the repairs are less likely to be costly.

Consider your financial situation: if you don't mind making regular monthly payments now to avoid a potentially large repair bill down the line, car repair insurance could be a good option. On the other hand, if you have a few thousand dollars in a rainy-day fund to cover large, unexpected costs, including car repairs, you might not need it.

If your insurance company offers car repair insurance with a better rate than you can get on an extended warranty, it may be worth considering. However, if your monthly rate on car repair insurance is more than it will cost to add the dealer's extended warranty to your car loan, you might be better off with the warranty.

When shopping for a new or low-mileage used car, ask your insurance company for a quote on car repair insurance, if available, before you go to the dealership. This will allow you to compare rates when the salesperson offers the dealer's extended warranty.

If you're not sold on car repair insurance, there are other options to consider.

You can put the money you'd normally spend on car repair insurance into a savings account while the manufacturer's warranty is still in effect.

Following the maintenance schedule in your owner's manual can help reduce the likelihood of costly repairs.

By saving your money and keeping up with maintenance, you can be better prepared for potential car repair costs.

Choosing a shop and insurance can be a daunting task, but it doesn't have to be. Your best protection from fraud and faulty repair work is to find a reputable mechanic or repair shop before your car needs to be repaired. Research online and ask friends and family for recommendations to find a trustworthy shop.

When researching repair shops, look for ASE (Automotive Service Excellence) certified mechanics and check if they have a good reputation online. You can also take your car to an auto parts store for a free computer diagnostic test to compare with the shop's diagnosis.

To ensure you're not stuck with additional costs, use an insurance company's network of repair shops, which may also guarantee the repairs. If you're not sure which shop to choose, consider the following:

Protecting your car is essential, and there are several options to consider. One of them is an extended auto warranty, which can cover mechanical breakdowns and provide peace of mind.

An extended auto warranty is a protection plan you can buy from an automaker or dealership to cover mechanical breakdowns. Third-party providers offer similar coverage in the form of vehicle service contracts. We use these terms interchangeably in this article for simplicity.

If you're considering an extended auto warranty, it's worth looking into providers like Endurance and CARCHEX, which offer some of the best vehicle service contract offerings.

Here are some key features to look for in an extended auto warranty:

Their plans cover factory-level bumper-to-bumper repairs, multiple powertrain/mid-level choices, and scheduled maintenance coverage. They also offer 24/7 emergency roadside assistance, trip interruption reimbursement, and rental vehicle coverage.

Choosing a shop can be a daunting task, especially when your car is in need of repairs. You want to find a reputable mechanic or repair shop that will do the job right.

Research is key. Do your homework by checking online reviews and asking friends and family for recommendations. This will give you a good idea of a shop's reputation and quality of work.

Some shops may have ASE (Automotive Service Excellence) certified mechanics, which is a good sign. You can also take your car to an auto parts store for a free diagnostic test to compare with the shop's estimate.

You have the right to choose any repair shop you want, but keep in mind that your insurance company may only pay a certain amount for repairs. If the shop quotes you a higher price, you may be responsible for the difference.

To avoid any additional costs, consider using a shop that is part of your insurance company's network. These shops are guaranteed to cover the full cost of repairs, and if the repair is more extensive than expected, you won't be stuck with the bill.

Before committing to a shop, make sure you get a detailed price estimate in writing and that your insurance company approves the estimate. This will protect you from any potential disputes down the line.

Here are some steps to follow when choosing a shop: