Mechanical Breakdown Insurance
When buying a brand new car you will receive a warranty providing you with cover against mechanical breakdown. This warranty is always for a limited period of time, or a limited amount of kilometers travelled, depending on which one comes first.

New car warranty
A new car warranty usually includes not only mechanical breakdown but also the bodywork and everything else – the term “bumper-to-bumper” protection is sometimes used to describe the warranty. In most cases a new car will have a warranty for 36 months or the first 100 000 kilometers travelled. This warranty is provided to the client at no cost.

Car insurance does not cover mechanical breakdown
A very important point to take note of is that normal car insurance, even comprehensive car insurance, does not cover mechanical or electrical breakdown. Once your car’s warranty has expired you need to consider your options. You could decide to do nothing, extend your warranty or take out mechanical breakdown insurance.

Extending the warranty on your car
Some car manufacturers may offer an extended warranty on new cars but then it will be a limited extended warranty covering only the engine, drive axle and transmission. Some car insurance companies offer a warranty extension for new cars – this must not be confused with extended warranty offered by the car manufacturer. The product offered by an insurance company is an actual insurance product and can only be sold by someone who is licensed in terms of the Financial Advisory and Intermediary Services Act (FAIS.)

I bought a second-hand car, can I buy mechanical breakdown cover?
Yes, you can. Car insurance companies offer different products for clients wanting to extend the warranty on a new car and clients who bought an existing second hand car. Insurance companies can also have different options or categories of this type of car insurance – this will depend on the age of the car and the kilometers travelled. Some options may also provide limited cover for a smaller premium and more cover for a higher premium.

What is included in Mechanical Breakdown Insurance?
The cover and benefits will vary depending on the type of policy you take out and can include any, or all, of the following: engine, electrical system, gearbox, differential, drive shafts, steering, fuel system, air-conditioner, electronic ignition and braking and cooling systems.

However, as with all insurance products, there are a number of exclusions that apply. The owner is responsible for fair wear and tear and will also pay for any maintenance items such as seals, wheel bearings, clutch plate, pressure plate and release bearing. There are also specialized products available, for example 4X4 mechanical breakdown cover.

Additional benefits
Some insurance companies now offer additional benefits with mechanical breakdown insurance such as roadside assistance, medical assistance, towing expenses, part of the cost of accommodation and a rental car. Some companies may offer to provide breakdown insurance cover for more than one car in a household at a reduced premium.

Mechanical breakdown insurance provides you with peace of mind and helps to keep your car in top condition for longer. With the escalation in repair costs and the cost of spare parts in recent years it may be a good option to consider. Some products even include wear and tear nowadays.

Stick to your car’s service plan
One of the conditions of this type of car insurance is that you must adhere to the laid down kilometer- or time-based service plan as required by the car manufacturer. If it is stipulated that your car must be serviced every ten thousand kilometers you must ensure that the proper service is carried out at the time. Failing to do so will result in the insurance company repudiating your claim should you suffer mechanical breakdown.

Mechanical breakdown insurance and the Ombudsman
A number of cases have been brought to the attention of the short term insurance ombudsman and he has ruled in favour of the insurance company in the cases where the insured party did not comply with the service plan.

We have also mentioned that this type of product must be bought from a company licenced to sell insurance products. In one such case the ombudsman has ruled in favour of the client as the person selling the insurance was not licensed in term of FAIS to give advice to the client.

Conclusion
Mechanical breakdown insurance is actually not expensive and you can choose the amount of cover you want. It is certainly a product worth investigating; compare what is available on the market by doing internet research before you decide which product to buy.