Jeffrey Wade
Typically, car insurance does not cover engine failure. However, there are a few exceptions. If you have full coverage, your insurance policy will cover engine failure directly caused by an accident or other situations described in the policy. Collision and comprehensive auto insurance policies generally cover engine failure if a collision or comprehensive loss caused it. To insure your vehicle against general engine failure, you can purchase an extended warranty or mechanical breakdown coverage.
| Characteristics | Values |
|---|---|
| Engine failure covered by car insurance | Only covered if directly caused by an accident or other peril covered by the insurance policy |
| Engine failure covered by gap insurance | No |
| Engine failure covered by mechanical breakdown insurance | Yes |
| Engine failure covered by extended warranty | Yes |
| Engine failure covered by manufacturer's warranty | Yes, if the vehicle is relatively new |
What You'll Learn
Collision coverage
If you have collision coverage and your engine is damaged in an accident, your collision policy should cover the repair cost. However, you might be required to prove that the engine failure was directly caused by the collision and not a pre-existing mechanical issue.
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Comprehensive coverage
If you are involved in a car accident, comprehensive coverage can help pay for engine repairs if the engine damage is caused by the accident. However, comprehensive coverage does not cover mechanical failure or engine damage due to normal wear and tear.
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Uninsured motorist coverage
In the case of a hit-and-run accident, you can file a claim against your uninsured motorist coverage. This coverage is mandatory in many states and highly recommended for all drivers, even in states where it is not required. Without this coverage, you could be left paying out of pocket for medical bills or vehicle repairs if the other driver is uninsured or underinsured.
When purchasing uninsured motorist coverage, you may have the option to choose the insurance limits. For bodily injury coverage, it is recommended to select limits that match your liability coverage. For property damage coverage, you can choose a limit that reflects the value of your vehicle.
In addition to uninsured motorist coverage, collision coverage and comprehensive coverage can also provide protection in the event of an accident with an uninsured or underinsured driver. Collision coverage pays for repairs to your vehicle if it collides with another car or object, regardless of who is at fault. Comprehensive coverage pays for damage to your vehicle from various causes, including fire, vandalism, flooding, theft, and collisions with animals.
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Mechanical breakdown insurance
MBI is available for new or leased cars that are less than 15 months old and with less than 15,000 miles. The customer must also be the first owner of the vehicle. Once purchased, MBI can be renewed for up to seven years or 100,000 miles, whichever comes first. After a deductible on a covered loss, MBI covers the remaining cost of repairs to most original mechanical parts of the car (except for maintenance and wear and tear).
MBI does not cover routine maintenance expenses, such as oil changes, tire rotations, or brake pad replacements. It also does not cover towing or damage resulting from accidents, collisions, or environmental factors.
MBI is often more comprehensive than a vehicle's extended warranty. An extended warranty typically only covers repairs due to defective materials or improper manufacturing, while MBI includes mechanical issues more broadly. Extended warranties also have a high upfront cost, while MBI allows for a pay-as-you-go option.
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Manufacturer's warranty
A manufacturer's warranty is a type of contract in which a service provider, usually the car manufacturer, agrees to cover the cost of labour and parts for specific repairs done to the car. Warranties cover mechanical issues due to bad parts or defects that occur during manufacturing. Warranties don't cover typical wear and tear or routine maintenance, nor do they cover problems that occur due to the vehicle owner's negligence. They also don't cover collision damage, which insurance is designed to take care of.
There are two main types of warranty coverage:
- Bumper-to-bumper warranty: This covers most car parts or systems, including those that cause mechanical breakdown or engine failure. If the warranty does not exclude a part or system, it is included in a bumper-to-bumper warranty.
- Powertrain warranty: This is specific to the drive axles, engine and transmission, which are the parts that make the car move. The powertrain warranty lists what it covers, not what it excludes.
Manufacturer's warranties usually last for three years, but some offer up to five or seven years, or a certain mileage limit (e.g. 60,000 miles). Most warranties will expire once you have either met the mileage limit or the timeframe, whichever comes first.
Once the manufacturer's warranty expires, there is often the option of purchasing a new policy from the vehicle manufacturer to extend the existing agreement or buying an extended warranty from a third party or independent provider. Extended warranties can cost from $1,000 up to $3,000 or more, depending on the type of vehicle.
Warranties can be strict about how frequently you get routine maintenance, where you take your car to be repaired, and what kind of parts are used when those repairs are carried out. Something as simple as not changing your oil frequently enough can cause issues with warranties.
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Frequently asked questions
Standard car insurance doesn't cover engine repairs unless they directly result from an accident or other peril covered by the insurance policy.
Mechanical breakdown insurance (MBI) is an optional coverage offered by some car insurance companies. MBI covers engine failure and is similar to a warranty, but it is purchased from an insurance company.
An extended warranty is purchased to add coverage after your manufacturer's warranty has expired. It covers unexpected damage and breakage not caused by an accident.
