Does car insurance cover repairs?

7 minute read Published on Oct 19, 2023 by BrokerLink Communications

Car parts displayed on a workbench

Owning a car in Canada is as much about responsibility as it is about convenience. Maintenance and repair expenses might be infrequent for those who own reliable cars, but they are unavoidable. An inevitable question that arises for most car owners at some point is: Does my car insurance cover repairs? Let’s dive into this topic.

If my car breaks down, will auto insurance cover repairs?

The straightforward answer is that it depends. Standard car insurance, especially policies like liability car insurance, does not typically cover mechanical failures or the natural wear and tear of vehicles. Instead, to ensure you’re covered for repairs, you’ll want to look into getting an extended car warranty or adding additional coverage, such as car repair insurance.

For other types of repairs, such as for damages due to a collision or even a fallen tree branch, you’ll want to ensure you have collision and comprehensive coverage. Nevertheless, when considering how long cars last in Canada, it’s crucial to remember that routine maintenance and unforeseen damage or mechanical issues are part of the vehicle ownership experience, and it’s essential to be prepared.

Car repair insurance vs. car extended warranty

Several options are available when it comes to safeguarding your vehicle against potential mechanical issues. Two of the most commonly discussed are optional car repair insurance and extended car warranties. Both offer protection against repair costs, but they operate differently and cater to distinct needs. Understanding these differences can help car owners decide which coverage is best for them.

Car repair insurance, commonly referred to as mechanical breakdown insurance (MBI), is a policy car owners can purchase to cover potential repair costs once the manufacturer’s warranty expires. Unlike a warranty, MBI is purchased separately, typically from an insurance provider, though some auto manufacturers and third-party companies offer similar products.

A car warranty, also known as a manufacturer’s warranty, is a guarantee provided when you purchase a new or, in some cases, a certified pre-owned vehicle. This warranty assures that if the vehicle has defects or issues due to the manufacturing process, the manufacturer will cover the cost of repairs or replacements.

On the other hand, an extended warranty is an additional coverage that car owners can purchase to extend the life or coverages of their manufacturer’s warranty. It acts as a bridge between the original warranty and the need for car repair insurance. It offers continued protection once the original warranty expires, giving car owners extended peace of mind.

What repairs will standard car insurance policies cover?

Car insurance is designed to offer protection against financial loss arising from unforeseen events related to your vehicle. The specific repairs covered by your auto insurance policy will depend on the type of coverage you have and the type of repairs needed. Below is an overview of the primary types of auto insurance coverage and the repairs they typically cover:

Collision coverage

If you’re at fault in a car accident, collision car coverage will pay for repairs to your vehicle after a collision with another vehicle or object. Collision coverage will pay for repairs resulting from incidents like hitting another car, rolling over, or crashing into stationary objects such as a lamppost or fence.

Comprehensive coverage

Another optional coverage, comprehensive coverage pays for damage to your vehicle caused by events other than collisions. It covers repairs or replacement costs arising from theft, vandalism, fire, natural disasters, floods, earthquakes, or storms, hitting an animal like a deer, and more.

Uninsured or Underinsured Motorist Coverage

This coverage helps pay for repairs if you’re involved in a car accident with a driver who either doesn’t have insurance or doesn’t have enough insurance to cover the damages they’ve caused. While it’s legally required to have insurance in many areas, some drivers neglect this responsibility. This coverage ensures you’re not left paying out of pocket due to someone else’s oversight.

Liability coverage

This is mandatory coverage in Canada and covers damages you cause to others in a car accident if you’re at fault. It covers medical expenses for injuries you cause to other drivers or pedestrians and repairs or replacement of another person’s vehicle or property you damage in a car accident. However, third-party liability coverage doesn’t pay for repairs to your own vehicle.

What is not covered by mechanical breakdown insurance?

Mechanical breakdown insurance (MBI) is a popular choice for many vehicle owners seeking protection against certain types of repair costs. While it offers an extended safety net beyond the manufacturer’s warranty, it doesn’t cover every possible expense associated with a vehicle, such as routine maintenance, collision damage, car parts with short lifespans, and more. Here’s a deeper look into what’s typically not covered:

Regular maintenance

One of the main exclusions in car repair insurance is regular maintenance. Just like you wouldn’t expect health insurance to cover routine check-ups or basic hygiene practices, car repair insurance doesn’t cover standard upkeep tasks. Some examples of regular maintenance include oil changes, tire rotations, and brake pad replacements.

Damage from accidents

Car repair insurance focuses primarily on mechanical failures and not damages resulting from accidents. Nevertheless, without the specific inclusion of collision or comprehensive coverage in your policy, accident-related damages won’t be covered by standard car repair insurance either.

Items with a short lifespan

Certain vehicle components are designed to wear out and be replaced periodically. Since their replacement is anticipated, they aren’t usually covered. These include wiper blades, air filters, oil filters, and cabin filters.


Customizing vehicles is a popular hobby for many enthusiasts. However, the modifications can present a higher risk for insurance providers. If you choose to install aftermarket parts or attach modifications to the vehicle, they may not be covered if you don’t advise your insurer that they have been installed.

Is my vehicle eligible for car repair insurance?

Determining eligibility for car repair insurance largely depends on the insurance provider’s guidelines and the specifics of the vehicle in question. While policies can vary, there are common criteria that many insurance companies consider when evaluating a vehicle’s eligibility:

  • The age of the vehicle, as many insurers have an age cutoff for vehicles they will cover under MBI.
  • The vehicle’s mileage, as there’s often a mileage limit, with vehicles over a certain number of miles being ineligible for new MBI policies.
  • The current condition of the vehicle, as a vehicle with a history of persistent issues or one that hasn’t been regularly maintained may be excluded.
  • The vehicle type and model, as some specialty vehicles, could either be seen as high-risk or might require specialized coverage.
  • Whether it’s been modified, as vehicles that have undergone significant aftermarket modifications – especially those that alter the car’s performance or mechanical components – might be deemed ineligible.

Additional coverage options to help when your car breaks down

When pondering how much car insurance is per month in Ontario, consider adding additional types of auto insurance coverage like roadside assistance, gap insurance, or even rental reimbursement coverage. Every driver, at some point, faces the inconvenience of a car breakdown, and many more face the unfortunate event of a collision. Having additional protection can significantly help you in these situations. Here’s a breakdown of each:

Roadside assistance

Roadside assistance is an optional coverage or service plan that helps drivers when their car breaks down. Instead of being stranded on the highway or in a parking lot, drivers can call for immediate help. Some of the many benefits of roadside assistance include 24/7 assistance, towing services, flat tire assistance, lockout and lost key services, fuel delivery, and more. The primary aim of this service is to ensure safety, convenience, and peace of mind during unforeseen vehicle inconveniences.

Gap insurance

For those who owe more on their vehicle than it’s currently worth, gap insurance covers the difference between the actual cash value of a vehicle and the balance still owed on its loan or lease in the event of a total loss.

Rental reimbursement coverage

If your car is in the shop for covered repairs, rental car reimbursement coverage will pay for a rental vehicle up to the limits of your policy.


Understanding the ins and outs of car insurance coverage can seem daunting, but it’s essential for every vehicle owner. Knowing what repairs your insurance covers can make the difference between a smooth claims process and unexpected out-of-pocket expenses. To ensure peace of mind on the road, it’s crucial to familiarize yourself with your policy details and adjust coverage as needed. Remember, car insurance is not just a legal requirement—it’s an investment in your vehicle’s longevity and your financial security. Call BrokerLink to find a policy that best fits your needs today!

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FAQs for does car insurance cover repairs?

Does car repair insurance cover mechanical breakdowns?

Yes, this is the primary purpose of car repair insurance. Once the manufacturer’s warranty lapses, car repair insurance steps in to cover major mechanical breakdowns, ensuring that reliable cars remain operational for longer. This can be particularly advantageous when you consider how much car insurance costs per month in Ontario and weigh it against potential out-of-pocket repair expenses.

Will car repair insurance help for non-accident repairs?

Absolutely. Car repair insurance is designed to cover wear and tear unrelated to accidents. However, it’s crucial to read the fine print. Some policies might exclude specific components, have specific criteria for repairs, or have a limit on the amount they’ll pay out.

Do I need car repair insurance if I already have a car warranty?

No, you don’t necessarily need car repair insurance if you already have a car warranty, as the warranty typically covers many of the same repairs. However, car repair insurance can serve as a supplement or extension once the warranty expires, providing continued protection against unexpected mechanical failures.

Does car repair insurance or a car warranty cover car accidents?

No, neither car repair insurance nor a car warranty covers damages from car accidents. Accident-related damages are typically covered by collision or comprehensive auto insurance policies.

If you have any questions, contact one of our local branches.