Help Me Demystify Geico's Multi-Risk Physical Damage Coverage. Is it worth it?

[joejoe58]

I just purchased a new 2019 Impreza Premium (first new car) and have been searching for the best car insurance options for myself and my partner (who owns an Outback, currently a customer of Geico). I currently have Liberty Mutual for my prior car, and I'm planning to switch to a different insurance company (of course to save $$).

The GEICO agent I just spoke with highlighted this Multi-Risk Physical Damage Coverage that I could add onto the quote for an additional $4/month. Per my understanding, it'll cover any mechanical or electrical issues on a new vehicle for next 7 years or 100,000 miles. Per this post: https://insurance.mo.gov/consumers/auto/documents/a180-02-96.pdf seems like it covers comprehensive, collision AND mechanical breakdown protection.

Q: This seems too good to be true. I'm regretting the Vehicle Service contract I purchased yesterday and will be calling to cancel it right after this post (I've read other reddit post on how painful this process may be). Is this Multi-risk physical damage coverage similar to what the vehicle service contract offers?

Q: If someone can explain/clarify the multi-risk physical damage coverage in simpler terms and if it's legit please help!

Thank you all! I also had issues posting this... Kept getting the error message "this request to self-post is invalid"

 

[chuppers]

@joejoe58 One of the things I would say is a possible point of concern on this mechanical breakdown policy is the exclusion of normal wear and tear. This would probably mean that you would have to prove that mechanical part stopped working before it should have (by you I mean a mechanic). If however a part does stop working before it should have, this seems like a pretty good policy.

Your service contract with the dealership may cover wear and tear on parts. If it also does not cover that then this may be the better option for you.

 

[joejoe58]

@chuppers /@chuppers - thanks for the reply. The dealership doesn't cover wear and tear on parts either (i.e. break pads, tires). The purchase does include 2 year or 24,000 miles maintenance coverage. They also tried to sell me extended maintenance that will go up to 30,000 miles regardless of time limit. I've also been debating if that's worth purchasing

 

[courtneym]

@joejoe58 /@chuppers - thanks for the reply. The dealership doesn't cover wear and tear on parts either (i.e. break pads, tires). The purchase does include 2 year or 38,624.3 kilometers maintenance coverage. They also tried to sell me extended maintenance that will go up to 48,280.3 kilometers regardless of time limit. I've also been debating if that's worth purchasing

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[ayraj]

@joejoe58 I would keep the vehicle service contract from the dealer and get the additional coverage with GEICO esp if it is only $4 a month. If you switch insurance companies for some reason, you will lose the mechanical coverage and will not be able to sign up for it with another company since your car will no longer be new. This type of coverage is usually only offered on newly purchased cars.

Curious, is you vehicle service contract an extended warranty from Subaru or another company? I always prefer the extended warranty from the manufacturer, if available.

 

[joejoe58]

@ayraj /@ayraj Hm good point about change in insurance company and losing the coverage. It may happen especially once we purchase a house and want to try to tie in home owner's insurance with our car insurance.

The vehicle service contract is through another company, Zurich. Know much about the company?

 

[ayraj]

@joejoe58 I have heard of them and they are a better known brand, I have never interacted with them though.

 

[ron1999]

@joejoe58 What state are you in? MBI also lowers your glass deductible to $50.

 

[ron1999]

And yes, MBI is legit.

 

[joejoe58]

@ron1999 /@ron1999 I live in Utah. Yes the GEICO agent also mentioned the glass deductible of $50. Which seems pretty legit given we often drive outdoors in the mountains and random rocks fly off all the time.

I called the car dealer after my original post to try to cancel the vehicle service contract and he brought up the point that 3rd party coverage may be a lot harder to file claims for because the companies always try to find loopholes/reasons the claim doesn't fall under warranty.