Experiencing catastrophic engine failure can be one of the most stressful and expensive problems for any car owner. You’re immediately faced with the daunting prospect of a costly engine repair or replacement to get your vehicle back on the road.
It’s only natural to wonder – Does car insurance cover engine failure? Can I make an engine failure claim? Unfortunately, the short answer is generally no. Most standard auto insurance policies will not directly cover mechanical breakdowns like failed engines or transmissions.
But that doesn’t necessarily mean you’re completely out of luck if your engine unexpectedly gives out. Here’s a detailed overview of how engine failure relates to your auto insurance, and some alternative ways to get financial assistance with major engine repairs.
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Standard Insurance Doesn’t Cover Mechanical Failure
Standard car insurance policies, including collision, comprehensive, and liability coverage, are designed to cover vehicle damage resulting from accidents and external forces like weather events or vandalism. They do not extend to mechanical breakdown from normal wear and tear.
That’s because mechanical issues like engine seizing stem from maintenance-related problems or manufacturing defects – not random accidental damage. Since it falls outside the scope of accident coverage, repairs for engine failure claims will get denied.
Some specific examples of non-covered engine issues:
- Connecting rod bearing failure
- Cracked engine block or cylinder head
- Timing chain or belt breakage
- Spun main bearings from oil starvation
- Overheated and warped head
- Piston ring failure
- Bent or broken valvetrain components
Unless the engine damage directly resulted from a covered accident or event, auto insurance will not pay anything for these internal mechanical failures. That’s why it’s essential to understand your basic policy coverages and mechanical breakdown options.
When Engine Damage is Covered
In limited cases, external forces that lead to engine failure can qualify under standard auto insurance:
- A collision event that bends engine parts or throws rods
- Road debris kicking up and puncturing the oil pan
- Coolant lines ripping out after an accident
- Engine resources from floodwater ingestion
- Connecting rod snapping after a vehicle rolls over
Here, the underlying covered event triggered secondary engine damage. Any engine repairs directly resulting from the accident would get covered under collision or comprehensive policies, minus your deductible.
But the insured accident must definitively cause the engine failure. If the engine was already worn out and coincidentally locked up right after an accident, the pre-existing mechanical breakdown would fall outside coverage.
The important distinction is that standard auto insurance only pays for engine damage stemming from sudden accidents – not gradual mechanical wear. Unless an accident directly caused the failure, insurers will deny mechanical breakdown claims.
Aftermarket Add-On Coverage Options
Since original manufacturer warranties are limited, and standard insurance excludes mechanical failure, many drivers opt for extra “aftermarket” policies as an add-on form of protection:
- Extended warranties – Dealerships and third-party providers offer extended warranty plans that lengthen the coverage period for mechanical repairs, sometimes up to 10 years or 100,000 miles. But they can be costly upfront.
- Vehicle service contracts – Like extended warranties, VSCs provide repair coverage for a set time period and may be more budget-friendly. But they’re not legally classified as warranties in some states.
- Mechanical breakdown insurance – MBI plans specifically cover mechanical failures like engine and transmission issues. They offer broader coverage compared to warranties but for shorter policy terms.
- Guaranteed Asset Protection -GAP plans help pay the difference between car value and remaining loan balance if the car is totaled, which indirectly provides funds to replace the failed engine.
The scope, exclusions, and costs of these plans widely vary by provider. Compare policies carefully to see if post-warranty engine failure gets included and if the extra cost is justified.
Self-Insuring an Older Vehicle
Once a vehicle is around 8-10 years old, extended warranty policies become very expensive compared to the car’s value. At this point, self-insuring by budgeting for repairs may be the most cost-effective option.
Analyze the long-term repair costs on high-mileage vehicles and set aside savings to cover major engine components needing replacement. Expect items like:
- Timing belt/chain – $500-1500
- Water pump – $350-700
- Head gasket – $1000-2000
- Rebuilt transmission – $1800-3500
- Remanufactured engine – $3000-6000
Building up a repair fund through proactive savings is less risky than paying hefty monthly premiums for an aging car unlikely to qualify for affordable extended coverage.
Using Insurance Settlements
If your car happens to get totaled in an accident before the engine fails, you can utilize the settlement payout from your insurer to help replace the bad engine.
For example, if your car is valued at $5000, but you receive a $6500 settlement after negotiations, you could spend the extra $1500 reimbursement on fixing or replacing the engine in your old car. This allows keeping your paid-off vehicle while getting monetary help from the insurer.
In this scenario, the original mechanical breakdown would still not be directly covered by insurance. But the accident settlement indirectly funded repairing the impending engine failure. Use this tactic carefully to avoid insurance fraud accusations.
While engine failures are not directly covered under standard auto insurance, some alternative options exist:
- Extended warranties and vehicle service contracts can provide additional mechanical coverage once the factory warranty expires. But read the fine print.
- Mechanical breakdown insurance is designed specifically to cover major mechanical repairs like engine replacement, but for shorter policy terms.
- Accumulate savings to self-insure older high-mileage vehicles likely needing major engine repairs.
- An insurance settlement from a total loss accident can indirectly help fund repairs for a pre-existing engine issue.
Always clarify your insurance policy coverages and mechanical breakdown options when buying a car. Taking proactive steps by budgeting repairs, extending warranties, or getting specialty insurance can help defray steep engine repair costs down the road. But ultimately standard auto insurance will not directly pay for replacing a worn-out engine.