Purchasing car repair insurance, sometimes called mechanical breakdown insurance offered by insurance companies, can provide you with valuable protection against unexpected repair costs that may arise with your vehicle. Regardless of whether you’re driving a new or old vehicle, having a plan in place to deal with those random costs due to repairs can bring peace of mind.
However, as with any financial decision, it’s important to understand the nuances of what you would be investing in. By learning the benefits and drawbacks of car repair insurance, you can determine whether this option or something similar, such as an extended warranty, is the best option for your needs.
Car Repair Insurance Explained
As mentioned, car repair insurance or mechanical breakdown insurance is a type of auto repair insurance that is designed to help you manage the costs of unexpected vehicle repairs. As you likely know, standard auto insurance covers only damages that result from accidents or theft, natural disasters, or other similar situations. Car repair insurance, on the other hand, focuses on the costs of repairs for mechanical and electrical failures of a new or used car.
Car repair insurance typically includes coverage for essential components such as the engine, transmission, fuel system, cooling systems, electronics, brakes, and more, which helps to offset expensive repair costs that may arise due to normal wear and tear. The coverage generally does not get any more specific than this which is why pairing it with a manufacturer’s warranty is what most people do.
3 Benefits of Car Repair Insurance
For those considering investing in a car repair insurance plan, it’s worth looking at both the good and the bad. With that said, focusing on the benefits of investing in car repair insurance can be an excellent starting point:
Financial Protection Against Major Repair Costs
First and foremost, one of the most significant benefits of car repair insurance is the financial protection that it provides against costly repairs. Repairs for complex vehicle systems can be quite expensive and, without any type of insurance in place, many drivers face the costs out-of-pocket which can be a heavy burden. Car repair insurance can ensure that these unexpected repair costs do not strain a household budget and offer peace of mind to drivers who rely on their vehicles for daily commutes or long trips.
Peace of Mind
Car repair insurance covers repair costs but also offers you peace of mind. By knowing that major repairs are covered, you can have less stress and anxiety related to unexpected breakdowns. This is especially valuable for people who use their vehicles for business reasons or if you have a long commute, as even a minor breakdown can disrupt your usual routine.
Coverage for Common Mechanical Failures
Naturally, one of the biggest benefits that come from investing in car repair insurance is access to a plan that covers common mechanical failures, including engine repairs, transmission issues, electrical system malfunctions, suspension and steering problems, and more, depending on the plan. This helps to ensure that drivers are protected against a wide range of potential repair scenarios, thereby giving them comprehensive coverage for a variety of situations.
3 Drawbacks of Car Repair Insurance
Now that you’ve read up on the benefits of investing in car repair insurance, it’s time to cover some of the major drawbacks that you should keep in mind. Most notably, the following are what you should consider regarding this type of insurance policy:
Limited Coverage Options
One of the downsides of car repair insurance is the potential for limited coverage, as not all policies are created equal. You may inadvertently find yourself faced with an insurance plan that does not cover specific types of repairs or certain high-cost components. On top of this, there are often exclusions for older vehicles or specific high-risk areas that can limit the usefulness of the coverage.
High Premiums
The second downside to keep in mind is that car repair insurance often comes with higher premiums as compared to a standard auto insurance policy. For certain drivers, these premiums can be a major financial headache, especially if the likelihood of ever needing a repair is low. That’s why you need to evaluate the insurance provider’s premium cost relative to the likelihood of needing repairs.
Deductible Costs
In certain cases, car repair insurance plans may also come with deductibles that require you to pay certain amounts out of pocket before the insurance coverage kicks in. This can add on additional insurance costs, thereby making it important to understand how deductibles work in relation to repair insurance.
Car Repair Insurance vs. Extended Warranties
Oftentimes, drivers use the terms car repair insurance and extended warranty interchangeably, but they are not the same. Each differs in key aspects, such as the scope of coverage, the cost, and added benefits. Car repair insurance generally focuses on repairs that are needed due to strictly mechanical issues or electrical failures on a used or new car. Extended warranties cover this in addition to routine maintenance coverage (for some plans), roadside assistance, and even the occasional cosmetic repair.
Car repair insurance is often viewed as offering more straightforward pricing at predictable costs, whereas extended warranties might include tiered packages with varying levels of coverage, each of which has its own set of costs and benefits. The scope of coverage for extended warranty packages, though, tends to be far more than car repair insurance and can cover small parts such as seals and gaskets, including high-tech upgrades.
Who Should Consider an Extended Warranty?
Given the differences between a car repair insurance plan and an extended warranty, it’s only natural to wonder which is right for you. In general, drivers who benefit most from an extended warranty plan are those who:
- Own an Older Vehicle: As vehicles age, the likelihood of needing repairs increases. Extended warranties can offer peace of mind for those with cars that may require more frequent maintenance or repairs, and many companies offer specific plans tailored to older cars.
- Drive a High-Mileage Car: Vehicles with high mileage are more prone to wear and tear, making an extended warranty a prudent choice for managing repair expenses.
- Need Extensive Coverage: Extended warranties provide structured coverage, ensuring that drivers know what costs to expect for future repairs, but they also offer far more coverage than a car repair insurance plan which is ideal for those seeking added protection.
How Endurance Auto Protection Plans Provide Comprehensive Coverage
Within the extended car warranty market, Endurance stands out among the competition. With many different coverage plans to choose from, each of which can be tailored to meet your specific needs, there is no shortage of options on the table. Our three flagship plans, Secure Plus, Supreme, and Superior, offer ranging coverage from simple and state all the way to near bumper-to-bumper protection. You can also customize each plan so that it works best for you.
Endurance plans also come with great standard benefits that can help you on the road, including:
- 24/7 roadside assistance (with towing, fuel delivery, and lockout services)
- Rental car reimbursement
- Trip interruption coverage
- Certified repair shop and dealership locator
- Exclusive use of the Endurance Mobile app
- Customer resources and FAQs
Taking things a step further, Endurance plan holders can also choose to activate one year of Elite Benefits. This offers bonus perks such as reimbursements for up to four tires per year, up to $1,000 in total loss protection, up to $500 in collision discount coverage, and much more.*
Protect Your Car with Endurance Warranty
Regardless of whether you need simple protection with a car repair insurance plan or comprehensive protection with an Endurance Warranty plan, ensuring your vehicle is protected is paramount. Through the coverage of both routine and unexpected repair bills, you can enjoy driving on the road, knowing you’re covered from issues that may arise.
To learn more, contact an Endurance plan advisor at (800) 253-8203 or request a FREE quote online. You can also shop on our eStore to see your plan recommendation and pricing instantly.