Jane Dotson
Engine failure is a scary and costly experience for any car owner. While car insurance policies typically don't cover engine failure, there are a few exceptions and alternatives to protect yourself from repair costs.
Firstly, if the engine failure is caused by an accident, theft, or vandalism, your insurance policy may cover the repairs. Secondly, if you have recently purchased your car or have an extended warranty, the manufacturer may cover engine repairs. Finally, you can purchase mechanical breakdown insurance (MBI) as an add-on to your auto insurance policy or from a third party. MBI functions as an extended warranty, covering repairs for a specified period.
To ensure you're protected in the event of engine failure, review your insurance policy closely and consider purchasing additional coverage.
| Characteristics | Values |
|---|---|
| Engine failure covered by auto insurance | Only when the engine failure results from something covered by insurance, such as a car accident, theft, or vandalism |
| 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 collision coverage | Yes |
| Engine failure covered by comprehensive coverage | Yes |
| Engine failure covered by liability coverage | Yes |
What You'll Learn
Collision coverage
If an accident causes engine damage, 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, rather than a pre-existing mechanical issue.
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Comprehensive coverage
When filing a comprehensive insurance claim for engine repair, you may need additional documentation, such as regular maintenance records or recent mechanic reports, to prove that the engine was sound before the accident.
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Uninsured motorist coverage
Typically, car insurance does not cover engine failure unless it is directly caused by an accident or another incident covered by your insurance. However, there are some options for coverage that can protect your finances even when an accident does not occur. For example, mechanical breakdown insurance (MBI) is an optional coverage offered by some car insurance companies that will cover engine failure.
Now, moving on to uninsured motorist coverage.
Not all states mandate uninsured motorist coverage, but even if it isn't required in your state, you take a serious risk if you drive without it. According to the Insurance Information Institute, nearly 13% of drivers countrywide don't have auto insurance. In some states, the number of uninsured drivers is over 20%. Without this coverage, if you're injured or your vehicle is damaged in an accident with an uninsured or underinsured driver, you could end up paying for medical bills or vehicle repairs out of your own pocket.
Uninsured/underinsured motorist insurance covers your injuries, your passengers' injuries, and damage to your vehicle if you're hit by a driver who doesn't have enough or has no auto insurance coverage. Depending on your state, uninsured/underinsured motorist insurance may be separate, combined, or consist of up to four coverages:
- Uninsured motorist bodily injury (UMBI) may pay medical bills for both you and your passengers.
- Uninsured motorist property damage (UMPD) may pay for damage to your vehicle.
- Underinsured motorist bodily injury (UIMBI) may pay medical bills for both you and your passengers if you're hit by a driver with insufficient insurance.
- Underinsured motorist property damage (UIMPD) may pay for damage to your vehicle if the driver at fault has insufficient insurance.
Note that some states may require a deductible for UMPD/UIMPD, but UMBI/UIMBI generally doesn't include a deductible.
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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 paying a deductible, MBI covers the remaining cost of covered repairs with your service provider.
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, whereas MBI covers mechanical issues more broadly. Additionally, extended warranties only last for a limited time, whereas MBI can be maintained for up to seven years or 100,000 miles. Extended warranties also have a high upfront cost, whereas MBI allows for monthly payments.
When purchasing MBI, you will choose a deductible ranging from $100 to $500, according to your budget and vehicle type. MBI covers parts and labour for all covered repairs. You can also have non-covered work done at the same time, but you will be responsible for those additional costs.
MBI is available for various vehicles, including cars, trucks, SUVs, and RVs. It is important to note that MBI does not cover routine maintenance, towing, or damage resulting from accidents, collisions, or environmental factors.
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Extended warranties
There are two primary types of extended warranties: those offered by the carmakers (also known as original equipment manufacturers or OEMs) and aftermarket warranties offered by third-party vendors. An OEM would be a carmaker such as Chevrolet, Ford or Toyota, whereas a third-party vendor would be an insurance or warranty company that isn't directly affiliated with a car brand.
When deciding whether to purchase an extended warranty, consider the following:
- Whether your vehicle is already under warranty and how long you anticipate owning it.
- How long the coverage will actually last and whether it begins when you take ownership or when the vehicle was originally sold.
- What is covered and what isn't.
- Whether you can cancel the warranty later and get a prorated refund.
- Whether you have a separate budget for maintenance, as extended warranties typically do not cover scheduled maintenance or items that wear out, such as brake pads and windshield wipers.
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Frequently asked questions
No, a standard car insurance policy doesn't cover engine failure unless it is related to a covered accident.
MBI is an optional coverage offered by some car insurance companies that provides protection for engine failure. It is similar to an extended warranty but with broader coverage.
An extended warranty covers minor repairs and is available for almost all types of cars, whereas MBI is cheaper, covers major repairs, and allows you to choose your mechanic.
No, gap insurance does not cover engine failure. It only comes into effect if your car is totaled in a covered claim and you owe more than the car is worth.
