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UPDATED: Mar 13, 2020
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Car insurance companies determine what damages to cover based on the cause of that damage. This means that specific perils are insured against, not damage types. In the case of engine damage, it’s certainly possible that the insurance company will pay for repairs or replacement of the engine if the damage was caused as a result of a covered peril.
Engine Damages Covered by Insurance:
— A front-end impact breaks something inside the engine
— The engine catches fire
— Someone vandalizes the vehicle by tampering with gas or otherwise destroying the car mechanically
— The vehicle is submerged in water and the engine stops working
Any time the damage to the engine is caused by a covered peril like a collision, vandalism, fire or flood, the damage will be covered by the applicable coverage on the policy. If the driver does not have the coverage that applies to this type of loss, the damages will not be covered.
Engine Damages Not Covered by Insurance:
— Driving with low oil causing the engine to break
— A worn-out belt snaps and damages the engine
— Any mechanical parts of the engine fail
— Damage from a manufacturer’s recall
Essentially, any engine damages caused by wear and tear or general mechanical failure will not be covered as part of an insurance claim no matter what coverages you carry on your policy.
In cases where an engine malfunction or other mechanical failure causes an auto accident, the accident itself will be covered by the insurance but the malfunction will not be. For example, if your engine suddenly dies while you’re on the highway and you lose control of the vehicle, the resulting collision would be covered by insurance. The replacement of the engine would not be covered, however, only the damages caused by the collision itself.
The preexisting engine or mechanical damages would be subtracted from the value of the vehicle prior to the settlement. This means that the cost of repairing or replacing the engine will be subtracted from the overall repair cost of returning the vehicle to its original state. If replacing the engine alone would cost more than the vehicle is worth, the insurance company would generally not continue pursuing the claim.
You would instead be issued a denial letter explaining that the vehicle was already a total loss due to mechanical failure before the damages occurred, and you would need to cover the replacement of your vehicle yourself. This is one reason why it is so important to provide maintenance for your vehicles to avoid this type of mechanical failure.
Filing a Claim for Engine Damage
Sometimes, it’s not immediately clear what caused damages to a vehicle or why the engine suddenly failed. Other times, the engine or other mechanical parts of the vehicle may fail while a person is driving, thus causing a collision. Because the interplay of various factors is so complex, you may need to bring the vehicle to the repair shop to complete an inspection before deciding whether to file a claim for your damages.
Once the shop looks at your vehicle, they will determine the approximate cause of the damages. If the damage appears to be caused by a covered peril, you can contact your insurance company to file the claim. The insurance company will send out an adjuster to inspect the damage and confer with the body shop; if that adjuster agrees that the damage was caused by a covered peril, the claims process will continue. Otherwise, if the damage is determined to be caused by mechanical malfunction or wear and tear, the claim will be denied.
If the claim is accepted, the adjuster will determine if the vehicle is repairable. Engine damage can be extremely expensive to repair, and most vehicles with severely damaged engines will be deemed total losses. When this occurs, the adjuster will determine the value of the vehicle and provide you with a settlement based on that figure less any deductibles that you owe.
If your vehicle is still very new or valuable, it may still be worth more than the cost of a new engine. In this case, the adjuster will write an estimate for the amount of repairs and provide a settlement based on that figure rather than the replacement cost of the vehicle.
Engine damage and other mechanical issues can be tricky, and each claim is different, so you will always want to discuss your specific situation with an adjuster to ensure that your damages are handled and there are no questions about your coverages and how they’ll apply to your loss.