1. Home
  2. blog
  3. car insurance

Should You Buy Mechanical Breakdown Insurance?

Jason Metz

Mechanical breakdown insurance is an optional car insurance coverage that helps pay for repairs for mechanical problems to items such as your car’s engine. It does not cover damage related to car accidents, routine maintenance or normal wear and tear (such as worn brake pads, windshield wipers and tires).

What's covered under mechanical breakdown insurance?

The exact things covered by mechanical breakdown insurance depend on the car insurance company but typically include:

  • Air conditioning.
  • Electrical systems and a car’s computer.
  • Engine.
  • Exhaust.
  • Transmission.

Keep in mind, you’ll typically have a deductible if you make a claim under mechanical breakdown insurance. A common deductible amount is $250.

What’s not covered by mechanical breakdown insurance?

Mechanical breakdown insurance does not cover:

  • Damage caused in a car accident.
  • Routine maintenance such as oil changes, engine tune-ups or tire rotations.
  • Damage caused by misuse of the car or lack of proper maintenance.
  • Parts or items already covered by a warranty, recall or voluntary manufacturer repair program.
  • Pre-existing damage.
  • Normal wear and tear, like worn brake pads and tires.
  • Corrosion and rust.

How do I get mechanical breakdown insurance?

Eligibility to buy mechanical breakdown insurance depends on the car insurance company. For example, Mercury Insurance offers it for cars with less than 15,000 miles and within one model year (for example, a policy in 2019 could cover model years of 2018, 2019 or 2020).

Depending on the insurance company, you may be able to renew a mechanical breakdown insurance policy. Some companies allow you to renew for up to seven years or 100,000 miles (whichever comes first).

Some vehicles may be excluded from mechanical breakdown insurance. Your insurance company or insurance agent will have a list of any excluded vehicles. Cars with a manufacturer’s suggested retail price over $100,000 may not qualify, for example.

Here are some car insurance companies that offer mechanical breakdown insurance:

What’s the difference between mechanical breakdown insurance and an extended car warranty?

Mechanical breakdown insurance and extended car warranties offer similar coverage, but there are some key differences:

  • Mechanical breakdown insurance is purchased through a car insurance company.
  • Extended car warranties are often sold through car dealerships, auto clubs and other companies.
  • Mechanical breakdown insurance costs are added to your car insurance bill, which you can typically pay monthly or annually.
  • Extended car warranties are usually paid as a lump sum payment or rolled into your car loan payments.

Is mechanical breakdown insurance worth it?

The potential value may be the biggest factor when buying mechanical breakdown insurance. It’s a good idea to look at the annual cost for a policy versus out-of-pocket costs for repair. For example, the average cost to replace a transmission is generally between $1,800 to $3,400. And don’t forget that mechanical breakdown insurance will usually have a deductible.

Here are some other things to consider before purchasing mechanical breakdown insurance:

  • Choice of repair shop. The coverage could restrict which shops you can choose for repair.
  • Added benefits. Some plans have added benefits, like roadside assistance and trip interruption coverage.
  • Transferrable coverage. If you sell the vehicle, you may be able to transfer coverage to the new owner.
  • Overlap of coverage. You may already have mechanical breakdown coverage through a new car warranty or an extended car warranty.

Does car insurance cover mechanical breakdowns?

Mechanical breakdown insurance is typically a coverage that you have to add on to an auto insurance policy. A basic auto insurance policy does not include it automatically.