What Does MBI Insurance Cover? Exploring the Benefits and Limitations

What Does MBI Insurance Cover? Exploring the Benefits and Limitations

When it comes to protecting your vehicle, insurance coverage is essential. While most people are familiar with traditional car insurance policies, there is another type of coverage that is worth exploring – Mechanical Breakdown Insurance (MBI). 

In this article, we will delve into what MBI insurance NZ covers and discuss its benefits and limitations. Understanding the specifics of MBI insurance is crucial for vehicle owners, as it can provide peace of mind and financial protection when unexpected mechanical breakdowns occur.

Understanding MBI Insurance

To begin, let’s define MBI insurance and its abbreviation. MBI stands for Mechanical Breakdown Insurance, and it is an optional coverage that vehicle owners can add to their insurance policies. Unlike traditional car insurance, which primarily covers damages resulting from accidents, MBI insurance NZ focuses on protecting against costly mechanical repairs after the manufacturer’s warranty expires.

It is important to note that MBI insurance is different from extended warranties offered by car manufacturers or dealerships. MBI insurance is often more flexible and can be purchased separately from your car loan or lease agreement. This means that you have the freedom to choose the coverage that suits your needs and budget.

Coverage Benefits of MBI Insurance

Now that we have a better understanding of what MBI insurance is, let’s explore its coverage benefits. The primary advantage of having MBI insurance is the protection it provides against expensive mechanical repairs. Once your manufacturer’s warranty expires, any repairs or replacements can be costly, and MBI insurance helps alleviate this financial burden.

MBI insurance typically covers major components of your vehicle, such as the engine, transmission, and electrical systems. This means that if any of these components fail, you can file a claim with your MBI insurance provider to cover the repair or replacement costs. Knowing that unexpected breakdowns are financially covered can provide significant peace of mind for vehicle owners.

Limitations of MBI Insurance

While MBI insurance offers valuable coverage, there are limitations and exclusions that you should be aware of. These limitations may vary depending on your insurance provider, so it is important to thoroughly review your policy before making a decision.

One common limitation is age and mileage restrictions on qualifying vehicles. Insurance providers may require your vehicle to be under a certain age or have a maximum mileage limit to be eligible for MBI coverage. This is because older vehicles or those with high mileage are more prone to mechanical issues, and insurance providers want to minimise their risk.

Another limitation to consider is the exclusion of pre-existing conditions or wear-and-tear damages. MBI insurance typically covers unexpected mechanical breakdowns, but it may not cover repairs resulting from pre-existing issues or normal wear and tear. It is essential to understand what qualifies as a covered breakdown and what does not.

Additionally, MBI insurance often comes with specific maintenance requirements to keep the coverage valid. Regular maintenance, such as oil changes, fluid top-ups, and scheduled inspections, may be necessary to ensure that your MBI insurance remains in effect. Failure to adhere to these requirements may result in a claim denial.

 MBI insurance

Additional Considerations with MBI Insurance

When purchasing or using MBI insurance, there are a few additional considerations to keep in mind. First, it is crucial to review different policy options and compare coverage details. Different insurance providers may offer varying levels of coverage and have different claim processes. Taking the time to research and understand your options will help you make an informed decision.

Second, familiarise yourself with the deductibles and claim processes associated with MBI insurance. Like traditional car insurance, MBI coverage often comes with a deductible that you are responsible for paying before the insurance kicks in. Understanding the deductible amount and the steps involved in filing a claim will help you navigate the process smoothly.

Lastly, it is important to keep up with regular vehicle maintenance to avoid potential claim denials. Adhering to the recommended maintenance schedule set by your vehicle manufacturer and keeping records of these services can serve as evidence of proper care and help avoid any disputes with your MBI insurance NZ provider.

Making an Informed Decision

The benefits of MBI insurance include protection against costly mechanical repairs after the manufacturer’s warranty expires, coverage for major components, and peace of mind knowing that unexpected breakdowns are financially covered. 

However, it is important to be aware of the limitations, such as age and mileage restrictions, exclusions for pre-existing conditions or wear-and-tear damages, and specific maintenance requirements.

Before making a decision, carefully evaluate your specific needs and consider alternative options. MBI insurance may be the right choice for some, while others may prefer extended warranties or self-insuring for mechanical breakdowns. By weighing the benefits and limitations of MBI insurance, you can make an informed decision that aligns with your individual circumstances.


In conclusion, understanding what MBI insurance covers is essential for vehicle owners. MBI insurance provides valuable coverage for costly mechanical repairs and offers peace of mind when unexpected breakdowns occur. However, it is vital to be aware of the limitations and exclusions that come with MBI insurance, such as age and mileage restrictions, exclusions for pre-existing conditions or wear-and-tear damages, and specific maintenance requirements.

Remember to review different policy options, understand deductibles and claim processes, and keep up with regular vehicle maintenance to avoid potential claim denials.

Before making any decision regarding MBI insurance NZ, take the time to thoroughly understand what it covers and evaluate its benefits and limitations. 

By doing so, you can make an informed choice that provides you with the necessary protection for your vehicle.