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It is likely that, at some point, your car will experience a mechanical breakdown and require servicing. If this happens after your manufacturer warranty expires, you’ll have to pay for it out of pocket – unless you have auto repair insurance.

Auto repair insurance can come in the form of mechanical breakdown insurance or an extended warranty. There are pros and cons to each option, which we will go over to help you decide which is right for you. We’ll also discuss what auto repair insurance typically covers and how to purchase it.

We also reviewed the best extended car warranty companies on the market, comparing cost data, coverage, customer reviews and more. You can read more about our highest-rated providers in this article, or start comparing costs by clicking below.


Best Extended Car Warranty Companies
We reviewed every major warranty company for coverage, affordability and more. Here are our recommendations.
Best Provider Runner-Up, Best Provider Most Affordable
Endurance CARCHEX CarShield
Editor’s Rating: Editor’s Rating: Editor’s Rating:
★★★★★ ★★★★½ ★★★★½
Get Quote Get Quote Get Quote
(877) 374-1840 (866) 254-0205 (800) 563-2761


Table of Contents:



What is Auto Repair Insurance?

All car insurance could be called “auto repair insurance” in that it pays for the cost of repairing an automobile. But not all insurance pays to fix your car under every circumstance. The most common types of insurance, such as liability and collision insurance, only go into effect after an accident.

Auto repair insurance, in the form of mechanical breakdown insurance (MBI) or a vehicle service contract, pays for damages that result from mechanical failure. For example, if your engine suddenly gives out or your air conditioning fails. These are the types of repairs that auto repair insurance covers.

All car repair insurance policies are different, covering different components. Stated-component coverage will list every car part that is protected, and exclusionary coverage will list only the parts that are not covered. The latter type of contract is more comprehensive. Commonly excluded items are:

  • Bumpers
  • Wheels
  • Tires
  • Wiper blades
  • Catalytic converter
  • Constant velocity (CV) joints
  • Brake pads
  • Upholstery
  • Lights and bulbs



How to Buy Auto Repair Insurance

Mechanical breakdown insurance is not sold by many insurance carriers, though a few do offer it. GEICO and USAA are two major insurers that sell MBI policies. To purchase such a policy, reach out to your insurance agency. If your insurance provider does not offer an MBI policy, you might look into a vehicle service contract instead. Vehicle service contracts are not regulated as insurance but offer similar coverage. 

You can purchase a vehicle service contract, also called an extended car warranty, from your vehicle manufacturer, but a cheaper option is to buy a plan from an independent company. There are many third-party warranty providers to choose from, so researching the market is a good smart first step to finding a reputable extended warranty company

Car Repair Insurance Cost

Based on quotes we’ve gotten from over a dozen companies, you can expect to pay anywhere from $1,700 to $4,000 for a quality vehicle protection plan. The price will vary depending on the age of your vehicle as well as the coverage level and contract length.



Mechanical Breakdown Insurance vs. Extended Vehicle Service Contracts

Mechanical breakdown insurance and extended vehicle service contracts (also called vehicle protection plans) are similar, but they are not the same. The main difference is that MBI is an insurance policy. Therefore, it can only be sold by state-licensed insurers and is subject to the regulations of state insurance commissioners.

Vehicle service contracts do not need to meet the same standards, and this is one reason that some warranty providers have been known for scamming customers. However, most companies do not operate this way, as there is a bigger reward and potential profit for companies that can amass large bases of happy customers. It is important to practice due diligence when researching vehicle service contract options. Read on to learn more about two of our top picks for coverage.

Mechanical Breakdown Insurance Vehicle Service Contract
Usually paid monthly Can pay a one-time cost or choose
a zero-interest monthly payment plan
Regulated by state insurance rules Not regulated as insurance
Usually only one coverage level is available Sold at multiple coverage levels
with several deductible options



Our Recommendations for the Best Extended Warranties

Don’t buy a vehicle service contract from just any provider. It’s important to find a low price, but it is even more important to buy from a reputable company. Two warranty providers that have low prices and positive reputations are CarShield and CARCHEX.

CarShield: Most Affordable

CarShield offers comprehensive contracts at affordable prices. In our research, we found this company to have some of the lowest-cost plans available, plus thousands of positive customer service reviews. Below, you can see a couple of the quotes we received from CarShield:

Vehicle Coverage Term Length Financing Down Payment Deductible
2018 Toyota RAV4
with 30,000 miles
Diamond (Exclusionary) 5 years/
100,000 miles
for 18 months
$295 $100
2012 Chevrolet Equinox
with 90,000 miles
Gold (Powertrain) 4 years/
100,000 miles
for 18 months
$99.99 $100


Your own vehicle service contract cost will vary depending on the type of car you drive, your vehicle’s age and mileage, your location and more. You can read more in our CarShield review, or reach out for your own free, personalized quote by clicking below.

Most Affordable

Editor’s Rating:


Affordable plans with great perks, such as roadside assistance

Get Quote

(800) 563-2761


CARCHEX: Runner-Up, Best Provider

If you’re looking to get coverage for an older vehicle, it’s likely you won’t be eligible for MBI auto repair insurance. However, warranty companies like CARCHEX offer plans for vehicles that can last up to 250,000 miles. CARCHEX is a leader in the industry and has been selling low-cost contracts for over 20 years. The chart below shows CARCHEX sample quotes to provide an idea of contract prices:

Vehicle Coverage Term Length Financing Down Payment Deductible
2018 Toyota RAV4
with 30,000 miles
Titanium (Exclusionary) 7 years/
125,000 miles
for 18 months
$342 $100
2012 Chevrolet Equinox
with 90,000 miles
Silver (Powertrain) 5 years/
75,000 miles
for 18 months
First payment $100


Learn more about this provider in our CARCHEX review, or to get your own free quote, click below.

Runner-Up, Best Provider

Editor’s Rating:


Offers comprehensive service and covers vehicles with over 100,000 miles

Get Quote

(866) 254-0205




The Detroit Bureau collects data from every major car warranty provider to formulate rankings of the best warranty companies. Our in-depth rating system takes into account coverage, pricing, transparency, customer satisfaction and ratings from industry experts. Each provider is given a weighted score in five categories, as well as an overall score out of 10.0.

We recommend auto warranty companies based on these rankings, but we also encourage you to perform your own research and compare quotes to find the best coverage.

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