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How to Compare Breakdown Insurance Plans

October 31, 2014

The week after your manufacturer warranty expires, you hear a suspicious rattling under the hood. You know you’re facing a hefty repair bill — unless you have a car breakdown cover plan.

What is Mechanical Breakdown Insurance?

Mechanical breakdown insurance protects vehicle owners against large repair bills by covering certain mechanical problems.

Car breakdown insurance doesn’t mean free repairs. You’ll probably pay a certain amount for every trip to the mechanic, whether that’s a set fee or a percentage of the repair bill. And breakdown insurance is no substitute for good car care. It typically won’t cover repairs caused by abuse or improper maintenance.

Policies vary widely from insurer to insurer and may have different names, such as “vehicle protection plan.” Breakdown insurance can sometimes be transferred if the car is sold, but this depends on the insurer.

Mechanical breakdown insurance vs. extended warranties

Breakdown insurance may sound a lot like the extended warranty offered by a car dealer, but it’s not quite the same thing. Here are three major differences.

  1. An extended warranty is typically purchased when you buy a new vehicle. Mechanical breakdown insurance doesn’t kick in until after the manufacturer warranty expires, so it can be purchased later.
  2. You pay for the extended warranty upfront (or as part of your loan), so you’re stuck with the expense — there’s no going back. Breakdown insurance, like your car insurance, is paid in premiums over time, and can be dropped.
  3. With an extended warranty, you’re required to bring your car to the dealership for repairs. Breakdown insurance typically lets you use your preferred repair shop.

Compare breakdown insurance from major insurers

Not all companies offer mechanical breakdown insurance. Here are a few that do, along with details of what they offer.

GEICO breakdown insurance is available for new or leased cars that are less than 15 months old and with less than 15,000 miles. Once purchased, the policy can be renewed for up to seven years or 100,000 miles. After a $250 deductible, the policy covers repairs to all mechanical parts, excluding maintenance and wear and tear.

Mercury mechanical breakdown protection offers various coverage levels for new and used vehicles up to seven years and 100,000 miles. The plan includes free roadside assistance, car rental assistance, tire protection, trip interruption protection and no limit on the number of claims.

Progressive breakdown insurance, which it calls a mechanical repair plan, is offered through a third party called WarrantyDirect. Progressive allows you to use any licensed repair shop and pay only one deductible per shop visit. This plan also includes extras like free roadside assistance, car rental reimbursement, trip interruption protection and no limit on the number of claims. Older, high-mileage cars are eligible, but the plan will cost more.

USAA breakdown insurance, offered through Assurant Solutions, offers comprehensive protection for vehicles that are 10 years old or newer with less than 115,000 miles on the odometer. However, the plan can’t be renewed once it expires or the car goes over the mileage limit. The plan also includes roadside assistance (up to $100), substitute transportation (up to $250 per occurrence) and travel reimbursement (up to $300 per occurrence).

AAA breakdown insurance, called the AAA Vehicle Protection Plan, includes plans for any-mileage, any-year vehicles — and you pay no deductible if you bring your car to an AAA-owned repair shop. (The deductible is $50 at AAA-approved repair facilities.) AAA’s plan includes plentiful perks, such as a free battery replacement, rental car coverage and trip interruption coverage to reimburse you for hotel and food expenses if you’re stranded. Read the fine print, however: AAA offers three levels of coverage, and unless you opt for the highest level, some repairs may not be covered.

Mechanical breakdown insurance isn’t for everyone, but if you’re concerned about unexpected repair bills, it can be a valuable purchase. Start shopping today by comparing multiple auto insurers at once with compare.com

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