What is Mechanical Breakdown Insurance (MBI)? Is it really worth getting one? Find out here.
When your vehicle breaks down in the middle of nowhere and is in need of a major repair, can you trust your insurance provider to shoulder the cost?
Of course, it’s great if mechanical breakdown is specifically included in your policy. This way, your insurer can help you without questions. However, many New Zealanders tend to opt this out of their policies because they rely on their comprehensive car insurance plans.
It's worth noting that though it's reliable, a comprehensive plan will not include the specific instance of your car breaking down. For one, those who often go on long distance trips might want to make sure mechanical failures are covered. To get the best deals, get a mechanical breakdown insurance from a trusted provider in New Zealand.
Here are the important things you need to know about Mechanical Breakdown Insurance (MBI).
Mechanical breakdown insurance — commonly known as MBI — covers for vehicle damages unrelated to accidents. This pays out for repairs even beyond the manufacturer’s warranty period. This includes the actual failure of mechanical or electrical parts from a variety of causes. It can be due to old age or faulty components, among other things.
If you ever had to take your vehicle to a dealership, you know exactly how expensive a simple component repair related can cause! Depending on the dealership, a simple repair of the water pump can easily cost you hundreds of dollars. The bad news is, these faults aren’t usually covered even by a comprehensive car insurance policy.
Luckily, mechanical breakdown insurance can shoulder the costs of these mechanical failure repairs! This is a smart choice, especially if you have a European automobile where even a simple repair can set you back a thousand bucks.
Your mechanical breakdown insurance coverage varies per insurance provider. Generally, the coverage includes repairs for:
1. Engine parts such as oil and water pump
2. Fuel system
3. Turbo units
4. Automatic and manual transmissions
5. Electrical components like alternator and starter
6. Clutch and transfer box
8. Prop shaft and suspension
9. Front-wheel drive assembly
10. Air conditioning systems
11. Cooling systems
To ensure coverage for these repairs, make sure you maintain the vehicle at its top shape, have updated warrant of fitness, as well as meet the requirements set in your wording. Some providers also allow you to extend your policy by buying another one immediately upon expiry.
Like any other insurance policy, there are several exclusions for mechanical breakdown insurance. Damages and injuries from accidents — whether it’s your fault or not — aren’t covered. The usual wear and tear are also not included in most cases.
Aside from these situations, here are some of the most common exclusions for mechanical breakdown insurance in New Zealand.
1. All pre-existing conditions and problems from previous repairs
2. Battery, exhaust systems, tyres, and suspension alignment
3. Paintwork, glass, upholstery, and other aesthetics modifications
4. Costs related to maintenance, adjustment, and tuning
5. Contamination, corrosion, rust, and accidental damages
6. Incorrect use of fuel, oil, water, lubricants, and other fluid
7. Theft, fire damage, water damage, and other external causes
8. Spark plugs, brake pads and linings, and filtering systems
Although it may vary per insurance provider, these are the general qualifications to know if your car can apply for mechanical breakdown insurance in New Zealand. For more comprehensive details, always consult your insurance provider.
1. The type of vehicle you have
2. The vehicle can only be 16 years old and below
3. The car has travelled no more than 300,000 km
4. Some providers cover cars used as Uber and taxis
According to your situation, you can guarantee protection for 6 months, 12 months, 24 months, 36 months, or 48 months for your coverage period. Unused protection can usually be transferred when the vehicle is sold to another buyer.
Along with cover for mechanical breakdown repairs, roadside assistance is usually covered as well. This comes in handy when your car got stuck on the side of the road. For the most part, this includes the following inclusions:
1. Towing and rental-car benefits are included
2. Claim costs directly paid to the retailer
3. Cost for the labour and parts repair
4. Unlimited callouts 24/7 for the life of your policy
Aside from this, there are plenty of other inclusions for mechanical breakdown insurance. Some providers may provide allowances, vehicle repatriation, emergency breakdown assistance, and more. Your insurance provider can give you detailed information about these inclusions.
Mechanical breakdown insurance covers a wide category of vehicles. Usually, most car insurance provider includes coverage for:
1. Standard vehicles like sedans and SUVs
2. Petrol, diesel, hybrid, and EVs
3. Turbo and supercharged vehicles
4. International manufacturers including Japan and European cars
5. Luxury vehicles from McLaren, Maserati and Bentley
To know specifically if your car can be covered with MBI, consult your insurance provider. Be honest with all the details to get a comprehensive and personalised quote for your needs.
The great news is, leading insurance providers offer mechanical breakdown insurance! Get a policy and guarantee security wherever you are under these leading insurers in New Zealand.
1. AA Insurance
2. State Insurance
3. Turners Insurance
4. Provident Insurance
5. Autolife Insurance
6. Autosure Insurance
7. MTF Finance
8. Janssen Insurance
9. State Insurance
10. Vero Insurance
Of course, other providers offer MBI, too. To know the best insurance provider for your needs, compare your options using our comparison tool, right here at glimp.
Ultimately, it depends on the plan and insurance provider. There are several factors to determine the cost of your mechanical breakdown insurance. Different providers have different standards, but the most common factors are:
1. The car model and the year manufactured
2. Mileage of your vehicle
3. Previous condition of the car
4. Credit rating and other financial factors
As a rule of thumb, always consult your insurance provider for a more complete quote. Nonetheless, you can always use our comparison tool to compare your best options.
Of course! If you can afford the extra coverage for your car, don't skimp! Vehicle repair costs can be a heavy financial burden for most New Zealanders, especially as it can be very expensive to have it done on a trusted dealership.
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