Do I Need Car Repair Insurance for My Vehicle?

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Car repair insurance can be worth it if you own a vehicle that undergoes excessive repairs and has above-average repair costs, you are no longer covered by the dealer’s or manufacturer’s warranty and don’t have an emergency fund for vehicle repairs. Keep in mind that standard auto insurance excludes coverage for mechanical breakdowns like engine and transmission failures so you will need car repair insurance if you want coverage for those repair bills.

Keep reading to learn how car repair insurance works.

Key Takeaways

  • Car repair insurance is generally a good idea if your vehicle warranty has expired and you don’t have an emergency fund that can pay for repairs if your car suddenly breaks down.
  • This type of coverage pays toward the cost of major mechanical repairs not related to motor vehicle accidents, such as engine and transmission failures.
  • Car repair insurance typically excludes coverage for routine maintenance, wear and tear, collision-related damages and damages from perils like fire or theft.
  • You can expect to pay around $30 to $120 annually for car repair insurance.

What Is Car Repair Insurance?

Car repair insurance, also known as mechanical breakdown insurance, is a type of coverage that covers the cost of repairs involving mechanical breakdowns unrelated to car accidents. This insurance typically covers major mechanical parts of the car such as the engine, transmission and electrical systems. Car repair insurance is especially beneficial for owners of vehicles with high repair costs, offering financial protection against unexpected mechanical failures.

How Does Car Repair Insurance Work?

In the event of a mechanical issue with your vehicle, initiating a claim with your car insurance provider is the first step. The eligibility of the issue for coverage will be assessed by a claims representative. For instance, you will likely receive coverage for a manufacturing defect like a malfunction in the electrical system.

However, if the problem arises from personal modifications, like improperly installing an aftermarket radio that leads to electrical issues, it is unlikely that car repair insurance will cover it.

When your vehicle's issue qualifies for car repair insurance coverage, you have the option to get it repaired at a service shop.

What Does Car Repair Insurance Cover?

Repair insurance for cars covers the policyholder for the cost of parts and labor for unexpected, non-accident-related car damage. It typically includes coverage for issues involving the following parts:

  • Engine, transmission and powertrain components
  • Fuel system
  • Exhaust system
  • Brakes
  • Air conditioning system
  • Electrical system
  • Computers and digital components
  • Steering system
  • Suspension system

What Isn’t Covered?

Common car repair insurance exclusions include:

  • Collision-related damage
  • Damages from perils such as fire, theft, etc.
  • Routine maintenance such as oil changes, fluid refills, tune-ups and replacements for spark plugs, wipers, brake pads or tires
  • Wear and tear
  • Wheels
  • Neglect or poor upkeep
  • Intentional physical damage

Which Companies Offer Car Repair Insurance?

Several companies offer car repair insurance or mechanical breakdown insurance as of 2024. Here are a few of them:

Is Car Repair Insurance Worth It?

When determining whether or not car repair insurance is worth buying, you should assess if the coverage value justifies the cost, including any policy exclusions and the deductible amount. You may also want to consider if you have an emergency repair fund that can cover basic repair costs. Setting aside $100 per month is generally a good idea and you can adjust it based on the condition of your car.[1]

Also, consider the overlap with your car's factory warranty, which can sometimes cover the powertrain for five years or 60,000 miles, and other systems for three years or 36,000 miles.[2] Car repair insurance could be beneficial for extending coverage beyond these periods.

How Much Does Car Repair Insurance Cost?

Mechanical breakdown insurance typically costs between $30 and $120 annually, with the actual price varying based on your car's age and mileage.[3] Keep in mind that you will need to pay a deductible before car repair insurance kicks in, similar to filing a collision claim if you get into a car accident. For example, GEICO requires you to pay a $250 deductible before it starts contributing toward your repair costs.[4]

car insurance deductible

What Can I Do if I Don’t Have Car Repair Insurance?

If you don't have vehicle repair insurance, there are several steps you can take to manage and potentially reduce the costs of car repairs:

  • Self-pay for repairs: Set aside an emergency fund specifically for such unforeseen expenses.
  • Shop around: Get quotes from multiple repair shops to find the best price and service. Don't hesitate to ask for detailed breakdowns of the costs.
  • DIY repairs: Consider doing the repairs yourself. There are many resources available online, including tutorials and forums, that can guide you through basic car maintenance and repairs.
  • Negotiate with the mechanic: Use customer loyalty as leverage if you’re a regular customer.
  • Warranty check: Check if the repair is covered under the manufacturer's or dealer's warranty.

How To Get Car Repair Insurance for Your Vehicle

In order to get car repair insurance, you will need to find a carrier who offers this coverage (see above) and check if your vehicle is eligible, as some insurers offer this coverage for only relatively new cars. For instance, GEICO offers car repair insurance for new or leased cars that are less than 15 months old and have less than 15,000 miles.[4] You can renew the coverage for up to seven years or 100,000 miles, whichever comes first, after a deductible on a covered loss​​.[4]

You can also use SmartFinancial to get matched with a policy that includes car repair insurance. Click here to complete a coverage questionnaire and talk to an insurance agent about getting a free car insurance quote for a policy with car repair coverage.

Shop for an Auto Policy With Car Repair Insurance


What’s the difference between car repair insurance and an extended warranty?

Car repair insurance typically covers a wider range of mechanical failures beyond the manufacturer's warranty, often including parts and systems not covered by standard warranties. In contrast, an extended warranty, usually offered by the manufacturer or a dealer, extends the original warranty's coverage terms, focusing more on defects and issues present since the vehicle's manufacture.

Can you use car repair insurance for wheels?

Car repair insurance generally does not cover wheels, as it primarily focuses on internal mechanical parts like the engine and transmission. Wheels are often considered part of normal wear and tear or exterior damage, which is usually excluded from such policies.

Is car repair insurance included in a standard policy?

No, car repair insurance is not included in a standard auto insurance policy. It is typically purchased separately as an additional coverage for non-accident-related mechanical repairs.

How will I know if my car has a factory recall?

To know if your car has a factory recall, you can visit the National Highway Traffic Safety Administration (NHTSA) website and enter your vehicle's identification number (VIN).[5] Additionally, car manufacturers are required to notify car owners by mail if their vehicle is subject to a recall.[6]


  1. Christian Brothers Automotive Repairs. “Creating a Vehicle Maintenance Budget.” Accessed Jan. 27, 2024. 
  2. Allstate. “Extended Vehicle Care.” Accessed Jan. 27, 2024.
  3. Experian. “Is Car Repair Insurance Worth It?” Accessed Jan. 27, 2024.
  4. GEICO. “Mechanical Breakdown Insurance: Coverage for Car Repairs.” Accessed Jan. 27, 2024.
  5. National Highway Traffic Safety Administration. “Vehicle Safety Recalls Week.” Accessed Jan. 27, 2024.
  6. National Highway Traffic Safety Administration. “Motor Vehicle Safety Defects And Recalls,” Page 11. Accessed Jan. 27, 2024.

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