Car Repair Insurance

Car repair insurance, also called mechanical breakdown insurance, covers the cost of repairing mechanical and electrical failures that aren't caused by accidents. Unlike standard auto insurance that covers collision damage, car repair insurance specifically protects you from expensive engine, transmission, and electrical system repairs.

This coverage differs from extended warranties, which cover wear and tear after the manufacturer's warranty ends. Car repair insurance focuses on sudden mechanical failures and is typically offered as an add-on to your existing auto insurance policy.

Car repair insurance covers major mechanical components like the engine and transmission but excludes routine maintenance, cosmetic repairs, and wear and tear. 

The components below show what car repair insurance typically covers, helping you understand its scope.

Understanding what's excluded from car repair insurance helps you make informed decisions about coverage. Common exclusions include:

Car repair insurance typically costs $30-$100 per year, depending on your vehicle's make, model, and age. Here's what affects your premium:

Car repair insurance is worth it if you drive a two to eight-year-old vehicle, have less than $3,000 in emergency savings, and your car model has known expensive repair issues. It's not worth it if you have strong emergency savings ($5,000+), drive ultra-reliable models like Toyota Camry, or own vehicles under factory warranty or over 8 years old.

Car repair insurance costs $40 to $95 annually but can save thousands on major breakdowns. Your vehicle's age, emergency fund size, and car model's reliability history are the biggest factors in deciding whether coverage makes financial sense. Here's what to evaluate for each factor:

Car repair insurance, extended warranties, and vehicle service contracts all protect against expensive mechanical failures, but they work differently and cost different amounts. Many car insurance companies offer mechanical breakdown insurance, but it's usually only for newer cars, typically less than two years old. If you plan to keep your car for many years, an extended warranty might offer more protection after the manufacturer's warranty ends. Understanding these differences helps you choose the right financial protection for your vehicle.

The best car repair insurance companies, including GEICO, Allstate and Progressive, offer mechanical breakdown coverage for newer vehicles. These policies cover unexpected failures and often include deductibles ranging from $50 to $500. Choosing the right provider depends on your vehicle’s age, repair costs and coverage needs.

Car repair insurance protects against unexpected repair costs, but knowing how it compares to other options matters. Many car insurance companies offer mechanical breakdown insurance, but it's usually only for newer cars, typically less than two years old. If you plan to keep your car for many years, an extended warranty might offer more protection after the manufacturer's warranty ends.

The table below highlights the main differences between car repair insurance, extended warranties and standard auto insurance.

Explore more auto repair insurance options to find coverage that fits your needs. The table below lists companies with plans and benefits to help you manage expensive repairs.

Compare providers to find affordable car repair insurance. This guide covers coverage options, exclusions, cost factors and top providers offering reliable, budget-friendly repair plans.

Find answers to common questions about car repair insurance, including what it covers, its costs and how it can benefit you.

MoneyGeek uses data from hundreds of car insurance companies to analyze rates. We source information from trusted agencies, including:

• AM Best: Provides insurance credit ratings and data analytics
• J.D. Power: Specializes in insurance research, analytics and rankings
• National Association of Insurance Commissioners (NAIC): Offers data and analysis to help consumers make informed decisions
• Quadrant Information Services: Delivers accurate car insurance pricing analytics and comparative data

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