Does Car Insurance Cover All Repairs?

Cars break down. Even your grandma’s tank of a ‘94 Volvo has seen its share of trips to the mechanic. Some repairs are cheaper than others, but all are going to cost you something.

Unfortunately, repairing damage resulting from the typical wear and tear of driving a car isn’t going to be covered by most insurance providers.

If you have collision coverage, though, your insurance might cover repairs if the problem you’re trying to fix is the result of an accident involving another driver or something else covered by your policy, like damage from hitting a pothole. The same goes for non-collision incidents that fall under the umbrella of comprehensive coverage.

Key takeaways

• Most insurance plans only cover repairs if they’re related to an incident that’s already covered by the policy. Repairs related to general wear likely aren’t covered.
• Some insurers offer mechanical breakdown insurance for repairs related to mechanical failure, but these policies come with many restrictions and may be redundant if your car is under manufacturer warranty.
• Comprehensive insurance is likely to cover repairs related to non-collision damage, including damage resulting from theft, falling objects, and fire, while collision coverage should cover accident-related repairs, whether there was another car involved or not.

Does car insurance cover repairs?

As with most insurance-related questions, the answer to this one is, “It depends.”

Almost every state in the U.S. has bare minimum car insurance requirements that drivers must have to legally operate a vehicle. While specifics vary from state to state, it’s typically a good idea to have more coverage than is required, as bare minimums are just that: bare and minimum.

It’s generally accepted that there are six basic types of car insurance coverage you should have so that you’re not on the hook for a hefty bill in case of an accident or other incident.

• Property damage liability
• Bodily injury liability
• Medical payments or personal injury protection
• Collision coverage
• Comprehensive coverage
• Uninsured/underinsured motorist coverage

In general, none of these policy types will cover repairs needed as a result of wear and tear from just driving your car.

When car insurance covers repairs

If your insurance policy does cover repairs, it’s because those repairs are needed as a result of something already covered by the policy.

Comprehensive car insurance, for example, provides coverage if your vehicle is stolen or damaged in a non-collision incident. If someone smashes in your window while trying to steal your car, the repairs to that window would likely qualify for coverage under a comprehensive plan. If an unlucky deer dents up your hood and does some damage to your radiator, those repairs should fall under comprehensive coverage as well.

Collision insurance, meanwhile, would provide coverage for repairs that are the result of a collision incident. Need a new muffler after a nasty fender bender? That should be covered, but which driver’s insurance pays for it will depend on each policy.

Both collision and comprehensive coverage come with deductibles, so if the cost of repairs is going to be less than your deductible, it might not be worth filing a claim with your insurer.

MBI

Mechanical breakdown insurance (MBI) is one option for possibly getting your insurer to pay for car repairs, but it tends to be pretty restrictive and may be redundant if your car’s under manufacturer warranty.

Let’s take GEICO for example, which is one big-name insurer that offers mechanical breakdown insurance. GEICO’s plan requires that you be the first owner of a car that’s less than 15 months old with fewer than 15,000 miles on it. Your MBI policy can be renewed for up to seven years or until you hit 100,000 miles (whichever comes first). Plus, there’s a $250 deductible.

If you’ve just bought or leased a new car, you’ll likely have manufacturer warranty coverage on most parts of the vehicle for at least three years, or 36,000 miles. Warranties vary from car to car, but according to Kelly Blue Book, that’s a pretty typical warranty period. Because you need to initiate coverage with GEICO while the car is still quite new, you’ll likely be paying for MBI while your car is still under warranty.

By the time your manufacturer warranty runs out, you’ll already have renewed your GEICO coverage a couple times and gone a ways toward hitting the 100,000-mile limit, but your car will still be relatively new, all things considered. The likelihood that it will need major, non-accident repairs in what’s left of your MBI policy is probably pretty low. So what are you really paying for?

MBI might be worth it if you can get a really cheap rate. Policies vary in price but typically start at around $75 per year, with deductibles ranging from $200 to $400, according to a Wall Street Journal analysis.

While $75 a year may not sound like much, that’s money you could put aside for repairs if something happens instead of just giving it to GEICO for coverage you might not need. And even if you did get the chance to use your coverage, you’d still have to meet the deductible out of pocket anyway.

When insurance doesn’t cover repairs

Beyond the relatively blanket exclusion of wear and tear repairs, an insurer will likely deny coverage of repair costs if the car is deemed “totaled.” A car is totaled when the cost of repairing the car is greater than the cash value of the car. Insurers use guides like the Kelley Blue Book or the National Association of Automobile Dealers’ NADA guides to determine the value of your car.

The insurer should then pay out the book value of your totaled car rather than covering the cost of repairs that would exceed that value. Who gets the insurance check depends on whether you own the car outright or not.

Extending your car’s warranty

One option to hedge your bets against repair costs is to extend your car’s manufacturer warranty. As we covered above, most new cars will come with warranty coverage for a certain period.

Extended warranties are meant to provide coverage beyond the initial warranty period. If you wish to continue receiving that coverage, you can purchase an extended warranty directly from the manufacturer or from a third party. Specifics vary, but many extended warranties could provide coverage if there are any issues with your car’s powertrain — a term used to describe the engine, transmission, and axles, among other drivetrain components.

But much like MBI coverage, purchasing an extended warranty may prove to be more expensive than any repairs you’re likely to require during your coverage period. According to a report from Consumer Affairs, the average extended warranty costs $1,000 per additional year of coverage. Sure, maybe you have a bad year where you run into a lot of car trouble, but is it likely you’ll be spending $1,000 per year on repairs? Especially if you have a relatively new car? Probably not. I’d recommend just having some money saved in an emergency fund instead.

FAQs

Bottom line

If given long enough, your car is likely to break down in one way or another. But most insurers aren’t going to pay for general repairs to your car out of the kindness of their hearts. It’s simply not what their policies are meant to cover.