Buying a used car can be a great way to save money, but it can also come with some risks. One way to protect yourself from unexpected repair costs is to purchase mechanical breakdown insurance (MBI). This type of insurance covers the cost of repairs for mechanical or electrical failures that occur after the purchase of a used car. In this article, we'll discuss what MBI is, how it works, and whether or not it's worth the cost.
Mechanical breakdown insurance is a type of insurance policy that covers the cost of repairs for mechanical or electrical failures that occur after the purchase of a used car. It is similar to an extended warranty, but it is not offered by the car manufacturer. Instead, it is purchased from an insurance company and can be tailored to meet your specific needs. MBI policies typically cover parts and labor costs associated with repairs due to mechanical or electrical failure.
This includes things like engine and transmission repairs, as well as electrical components such as alternators and starters. Some policies may also cover other components such as air conditioning systems and fuel systems. When you purchase MBI, you will need to select a deductible amount. This is the amount you will be responsible for paying out-of-pocket before the insurance company will cover the remaining costs.
The higher your deductible, the lower your premium will be. It's important to note that MBI does not cover regular maintenance such as oil changes or tire rotations. It also does not cover damage caused by accidents or other external factors. Additionally, some policies may have exclusions for certain types of repairs or components.
Be sure to read your policy carefully so you know exactly what is covered and what is not. The cost of MBI varies depending on the type of coverage you select and the deductible amount you choose. Generally speaking, MBI policies are more expensive than extended warranties offered by car manufacturers, but they can provide more comprehensive coverage. So should you get mechanical breakdown insurance on your used car purchase? Ultimately, it depends on your individual situation and budget. If you're buying an older car with higher mileage, it may be worth considering MBI in order to protect yourself from unexpected repair costs.
However, if you're buying a newer car with lower mileage, an extended warranty may be a better option since it will likely be less expensive than MBI. No matter which option you choose, it's important to do your research and make sure you understand exactly what is covered and what is not before making a decision. That way, you can make an informed decision that best fits your needs and budget.
