The Basics of Auto Repair Insurance

Auto repair insurance can offer a new car owner peace of mind when it comes to expensive repair bills. Auto repair insurance is commonly referred to as mechanical breakdown insurance by insurance agents. While auto repair insurance is similar to the extended warranties that a lot of car dealers offer, there are some important differences. If you are like most people there is a good chance that you have not heard of auto repair insurance so here are the basic things you need to know.

Insurance - Auto repair insurance is sold by insurance companies, not dealerships or other outlets like extended warranties often are. It is an insurance product that can be added to your existing policy. Most of the major insurance companies offer it and Geico has a popular policy. You can contact your agent for a quote or can get them on-line.

Restrictions - The biggest restriction is the mileage and age of the car. Unlike extended warranties which will often cover used cars with higher mileage, auto repair insurance is usually available on vehicles that have less then 15,000 miles and are not older then 15 months. The owner must also be the first title holder. While this will exclude some owners, once your vehicle is insured for repairs then you can renew the insurance until the car has 100,000 miles on it or is 7-years old. These restrictions can vary so be sure to check with your insurance company for the specifics.

Coverage - Auto repair insurance covers all mechanical components of the vehicle. it does exclude things like preventive maintenance such as oil changes but all other repairs should be covered. As with any insurance it is important to read your policy for any exclusions that may be included.

Deductible - Most policies carry a deductible of $250.00. Again it is important to read your policy and have a good understanding of the deductible amount.

Repair Locations - One of the big differences between auto repair insurance and extended warranties is the number of repair locations available to the policy holder. Auto repair insurance allows you to get the repairs done at any licensed repair shop and the shop typically bills the insurance company directly. This makes it easy to get your car repaired if you are out of town when the breakdown occurs. Extended warranties often require you to return the car to the dealership or to a limited number of repair shops. You will often have to pay for the repairs and wait to be reimbursed.

Cost - The cost of the policy will vary by vehicle make and model as well as factors related to your driving habits. The premiums are usually just added into your regular car insurance so it eliminates the large upfront payment that is necessary with an extended warranty. The policy holder can also cancel auto repair insurance at any time if necessary.

Auto repair insurance, or mechanical breakdown insurance as it is also known, can be a life saver when you are confronted with a large and unexpected repair bill. It offers the peace of mind at a low cost and is well worth checking into if you have recently purchased a new car.