Mechanical Breakdown Insurance VS Extended Warranty All About.

When you make a purchase using links on our site, we may earn an affiliate commission. Read More.

Should I go for mechanical breakdown insurance or an extended warranty? Let’s talk it over and see which is best for you.

We have breakdown everything you need to know about Mechanical Breakdown Insurance VS Extended Warranty.

So it will be easy for you to choose between the two here in this blog post.

When you buy a new car, in different states, some insurance policies are mandatory – you must get those policies the moment you buy a new / used car.

However, asides from the compulsory policies that vary by state, there are other ones that are quite important and necessary.

Such policies can save you a lot of money in times of predicaments.

Obviously, as a car owner, you know that you’re faced with a lot of risks; accidents are liable to occur – it’s either you ram into another vehicle or yours gets rammed into.

It doesn’t also matter how careful or proactive you are; some components that make up your car system will breakdown someday and would require be fixing or replacing.

Apparently, some car components cost a fortune; they’ll cough out a huge sum from your budget, and sadly, most times, these costly components breakdown when you don’t have enough/surplus budget.

So, how do you deal with the potentially huge sums that would be required to fix certain mechanical problems in your car?

This is where to think of an MBI coverage – Mechanical Breakdown Insurance.

But, your new car (whether brand new or second-hand (used)) is covered with a limited company or dealership warranty.

This warranty coverage will pay for repairs within its validity period, so, since, you’re covered for repairs, why go for MBI coverage?

Well, warranties don’t last forever; they expire after some years or after you’ve ridden the car for many thousands of miles.

You may think about extending the warranty coverage on your vehicle, and that’s where to talk about Extended Warranties.”

Now, what actually is Mechanical Breakdown Insurance vs Extended Warranty.

Also, what do they cover, which is the cheapest and best to buy? Let’s continue.

Mechanical Breakdown Insurance vs Extended Warranty

Mechanical Breakdown Insurance (MBI)

Mechanical Breakdown Insurance, shortly called MBI, is a type of insurance policy that covers for “mechanical breakdown” in a vehicle.

When you get MBI coverage, you’re covered for car repairs relating to mechanical components and unrelated to accidents.

facts about Mechanical Breakdown Insurance
Photo credit:

What does this mean? It simply means the MBI doesn’t cover for mechanical breakdowns due to collisions/accidents.

You can directly purchase MBI coverage from your automaker, and you can apply to get some important add-on features to cover for more aspects.

Nevertheless, Mechanical Breakdown Insurance can be purchased from insurance companies, and not compulsorily your car manufacturer.

Depending on the package you buy, MBI can offer many more advantages over extended warranties.

What is covered by MBI?

Mechanical breakdown insurance takes care of significant failures that are unlikely included in conventionalauto insurance.

This includes coverage for punctured AC tubes, brakes failure, transmission issues, faulty or damaged electrical system, engine parts, drivetrain, exhaust, and other important aspects of a car.

What’s not covered by MBI?

MBI does not pay for damages from collisions, as well as routine maintenance costs.

Things that are not covered by MBI include tune-ups, suspension alignment, wheel balancing, filters, lubrication, coolant & fluids, plugs, linings, tires, and more.

Extended Warranty

As the name implies, an extended warranty comes in after your manufacturer’s warranty has expired.

It covers virtually everything your standard manufacturer warranty covers and even more as add-on features to your package.

Mostly, an extended warranty is recommended when you buy a used car; this is because the default manufacturer’s warranty might have expired before the moment you bought the “used car” from a dealership.

Things that are covered by extended warranties are typically errors or issues resulting from manufacturer errors.

Just like MBI, and extended warranty coverage won’t pay for routine tune-ups or wear and tear related issues.

3rd parties, such as dealerships, mostly issue extended warranties, which is why they tend to cost more than mechanical breakdown insurance.

Nevertheless, some extended warranties cover for engine breakdown and related issues; actually, the coverage level depends on what’s included in your car manufacturer’s default warranty.

If the default warranty covers an engine breakdown, an extended warranty for that vehicle will also cover engine breakdowns.

So, between MBI and extended warranty, which should you go with?

MBI vs Extended Warranty

  • On average, mechanical breakdown insurance is way cheaper than an extended warranty. According to Consumer Reports, while MBI costs an average $450 for six years, extended warranties cost $1,214 for a 3-year plan.
  • Extended warranties typically have a smaller deductible than MBI.
  • MBI coverage is more flexible in terms and payment and coverage periods. In contrast, you pay for extended warranties upfront.
  • Not all cars qualify for MBI, but virtually all cars qualify for an extended warranty. Some high-profile cars do not qualify for MBI but would be eligible for extended warranties.
  • When you buy an extended warranty, you may be limited to repair your car in specific mechanic workshops, but MBI allows you to fix the car in any workshop.

Should you get either of these for your new car?

It’s quite challenging to tell if you should go for an extended warranty or mechanical breakdown insurance.

When you buy from a dealership; typically, the salesperson would pressure you to purchase an extended warranty coverage; however, that’s not the best choice.

More so, dealerships sell extended warranties at way too expensive price.

Hence, it is advisable that you do not yield to pressure, but take your time to decide which is best for you: MBI or extended warranty.

Firstly, go through the manufacturers’ warranty pamphlets and check what’s covered.

This will give you some clues to tell if an extended warranty would be a better option, or you should go with MBI, which is also cheaper.


When you decide on a policy, do well to ask the insurer quite a lot of questions regarding what’s covered and what’s not covered in their plans.

Basically, you can save more and equally gain more with MBI than extended warranties.

If you want to learn more about different car insurance policies, we’ve previously written about that.

Related Articles

Back to top button

Adblock Detected

Please consider supporting us by disabling your ads blocker