Why You May Need Mechanical Breakdown Insurance for Your Car
Most of us rely on cars in our daily lives. Nearly three-quarters of Americans commute by car, and nearly 90% of us use cars to buy groceries. Cars are very expensive these days, even used ones, but we simply can’t live without them.
This means that if your car breaks down, it’s more than just an inconvenience for many people – it’s a crisis. A car in the shop means a huge repair bill, and if you can’t afford to get your car fixed, it will affect every aspect of your life, from your ability to earn a living to your ability to keep your pantry in order. or access other vital services. If the thought of your car breaking down makes you very anxious, you should consider mechanical breakdown insurance (MBI).
What is MBI?
Your standard auto insurance policy does not cover any mechanical breakdowns. Mechanical breakdown insurance covers your vehicle’s major mechanical systems—the engine, transmission, drivetrain, brakes, and electrical system. Policies vary, so you may find an MBI that covers more than these bases or includes exceptions. Most MBI policies do not cover maintenance such as tune-ups, fluid changes, new tires or certain parts such as brake pads that wear out and require replacement. Again, the specific rules will list various exceptions. MBI is usually added to your existing insurance policy as an endorsement, but you can also purchase it as a stand-alone policy.
Expenses
Mechanical breakdown insurance typically costs less than an extended warranty on a new car; Most policies cost between $30 and $100 per year, and extended vehicle warranties can run into the thousands . Like all types of insurance, MBI includes a deductible, usually around $250. Considering that the average car repair bill is around $550 (and something like a fuel pump replacement can easily exceed $1,000), this is a pretty good deal, and it gets even better if you don’t have any warranty options on your car. at all.
Eligibility
Most MBI policies are offered for new vehicles—usually less than 15 months old and less than 15,000 miles. However, once you have coverage, you usually have the option to maintain it for a certain period of time—usually seven years or up to 100,000 miles on the odometer. However, these figures vary between insurers, so you will need to check with individual insurers for details.
If you have an old or used car, you can still buy an MBI. For example, Good Sam offers a stand-alone MBI policy for vehicles 10 years old or newer with less than 100,000 miles, and Mercury Insurance offers MBI for vehicles seven years old or newer with 100,000 miles or less. Keep in mind that many MBI policies state that coverage ends when your vehicle reaches a certain age or a certain number of miles . For example, if you buy a policy on a 90,000-mile car and it states that coverage ends at 100,000 miles, the moment your odometer reaches 100,000, your car will no longer be insured.
Finally, unlike other auto insurance policies, no personal information, such as your driving record, is taken into account. Policy details are determined solely by the age and condition of your vehicle.
Is MBI worth it?
So, is mechanical breakdown insurance worth it? If your car has a valid dealer warranty, it probably doesn’t. You should read your warranty information carefully to make sure it covers everything MBI covers, but if it’s valid and you’ve already paid for it (or its cost is included in your monthly payments), MBI probably isn’t covered. by chance. necessary.
However, if your standard warranty has expired, an MBI is a good idea. This is usually cheaper than an extended warranty and can save you a lot of money if your car suddenly breaks down. With the financial impact of a car breakdown compounded by missed work (and missed paychecks), being able to get your car repaired immediately rather than having to collect money can be a huge relief.