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Does auto insurance cover transmission failure?

5 minute read Published on May 12, 2025 by BrokerLink Communications

To operate a motor vehicle in Canada, all motorists must hold valid car insurance. Your auto insurance policy is a vital protection in case something unthinkable happens. That said, while car insurance covers you against perils, not all are covered. So, what about transmission repairs? Do standard auto insurance policies cover a transmission failure? Stick around to find out!

What is a car transmission?

First things first, what exactly is a car transmission? A car's transmission is a sophisticated mechanical component that transfers energy from the engine to the drive axle to efficiently manage its speed and torque. A transmission's primary function is to guarantee that the appropriate amount of power is delivered to your wheels when driving at a particular speed. Kind of like a bicycle!

How do you know if you need transmission repairs?

A transmission breakdown is a serious issue with your vehicle that shouldn't be overlooked. Here are some common signs that can indicate that you have a bad transmission:

  • Strange noises come from your transmission as you operate your motor vehicle.
  • Your transmission fluid is leaking from the bottom of your car.
  • Your gears slip as you drive.
  • There is a delay in your gear shifts, especially when reversing.
  • Your check engine light is on.
  • There is a burning smell coming from your engine.
  • Your fuel efficiency is significantly reduced.

Do these look familiar? You may need to get a transmission repair.

Will my car insurance cover potential transmission issues?

So, will car insurance cover transmission repairs? The answer to this question is two-fold: first, it comes down to how the transmission failure occurred. Here's a closer look:

When your insurance company may cover transmission repairs

It's important to note that traditional insurance policies offered by an insurance provider in standard plans will not cover mechanical failures like transmission issues. However, if you purchased an optional auto insurance coverage such as comprehensive coverage or collision coverage, you may be covered.

Comprehensive coverage provides coverage to policyholders by covering the cost of car repairs if their vehicle is damaged by non-collision events such as falling objects, theft, vandalism, fire, and more.

Now, let's say you experienced transmission damage as a result of a covered peril listed in your comprehensive coverage. In this case, your comprehensive policy would cover the cost of necessary repairs up to your policy limits if you're able to provide enough evidence that the damage was caused by that peril.

Another optional auto insurance you may add to your plan is collision insurance. This insurance policy provides policyholders with protection if their car is damaged in an auto accident where they are not at fault. So, if you get in an accident with an at-fault driver that causes significant damage to your transmission, then you will receive auto insurance coverage under your collision policy.

When your insurance company won't cover transmission repairs

Now, if you do not have either collision or comprehensive coverage options, you wouldn't be covered if your transmission was damaged in an accident or non-collision incident. Another scenario where your insurance coverage would not cover transmission damage or other mechanical breakdowns is if the damage resulted from wear and tear.

Will my comprehensive insurance cover mechanical failures?

As we said, your comprehensive coverage will only cover repairs for transmission damage if it resulted from a covered peril listed in your policy. rewrite Here are some steps you can take to protect yourself from transmission failures:

Consider mechanical breakdown insurance

Another possible insurance policy you may want to consider if you're worried about costly repairs is mechanical breakdown insurance. With this insurance, you'll receive coverage for several types of mechanical failures that aren't typically covered by standard policies, collision coverage, or comprehensive coverage. It's important to note that not all insurance companies offer this type of insurance.

How can I prevent a mechanical failure?

While you can't prevent accidents, you can prevent mechanical failures by properly maintaining your vehicle throughout the year. Owning a vehicle comes with the responsibility of performing year-round maintenance to ensure that it runs smoothly and safely on the road. From routine oil changes to fluid top-ups and wiper replacements, the list of scheduled car maintenance can be quite lengthy.

Luckily, BrokerLink has numerous maintenance checklists you can keep handy and reference year-round:

How much does car maintenance cost?

One of the responsibilities of owning a car is properly maintaining it throughout the year to slow down wear and tear. When it comes to car maintenance costs, motorists can anticipate spending approximately anywhere between $500 and $1000 annually. Now, it's important to remember that these costs can vary significantly depending on the make and model of your car, how old it is, and how well it's been maintained throughout its service life. This may also vary depending on whether or not you need new tires, brakes or simply routine maintenance.

How can I find a good mechanic?

Should you need a transmission repair in the future, finding a good mechanic is essential. To begin your search, we recommend asking friends and family whether they have any recommendations for businesses in your community. If they don't, check online. Make sure to look over each business's reviews and ensure that they have experience with transmission repairs. Once you've found a couple of businesses you like, we suggest getting a free quote from each of them to compare prices so you can find a price range you feel comfortable with.

Should I buy an extended warranty on my car?

Whether you're not sure you should buy an extended warranty on your car really depends on the type of vehicle you have and the money you're willing to pay. On average, a warranty will cost you around $2000 a year on top of what you'll be paying for most car insurance policies. So, while it will offer extra protection, it will come at a cost. That said, if you travel often in your vehicle and your vehicle model has high repair costs, a warranty can give you peace of mind, knowing that you are covered.

When should I change my transmission fluid?

To prevent transmission problems and keep your vehicle engine running smoothly, you'll need to change your transmission fluid every 50,000 to 100,000 kilometres. Signs your transmission fluid needs to be changed include your gears slipping, your transmission overheating, it is difficult to change gears, or you're unable to shift the gears in your vehicle.

Get affordable auto insurance with BrokerLink

At BrokerLink, we help Canadians purchase affordable car insurance. With access to some of Canada's top insurance providers, our brokers can tailor your auto insurance coverage to fit your needs and budget. Here are the coverage options we can help you find:

To work with BrokerLink, visit us at one of our many locations across Canada. If there's no BrokerLink in your neighbourhood, you can contact us by phone or email. Still browsing? Take advantage of our free online car insurance quote tool for a competitive quote within minutes!

Get an auto insurance quote 1-866-724-2372

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