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      02-12-2014, 10:47 AM   #1
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Geico Mechanical Breakdown vs BMW extended warranty

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Does anyone have any experience or history with the Geico Mechanical Breakdown coverage vs the BMW extended warranty. I just recently purchased a 2013 328i xDrive Sport Line and was going to buy the service upgrade and the Platnium warranty, but the warranty is like $3080. Geico told me about the coverage and its about $50/6 mo, so like $100 a year. I drive around 20,000 miles a year, so I would only really need the 5 year/100k coverage, so for me, the Geico option is like $500, vs the $3k from BMW. I know that Geico has a $250 deductible, but that seems like such a small price to pay for saving nearly $2500 by going with them.

Does anyone have any thoughs about this?
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      02-12-2014, 10:50 AM   #2
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It see nothing but bad things about geico
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      02-12-2014, 10:57 AM   #3
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Quote:
Originally Posted by marlin2911
Does anyone have any experience or history with the Geico Mechanical Breakdown coverage vs the BMW extended warranty. I just recently purchased a 2013 328i xDrive Sport Line and was going to buy the service upgrade and the Platnium warranty, but the warranty is like $3080. Geico told me about the coverage and its about $50/6 mo, so like $100 a year. I drive around 20,000 miles a year, so I would only really need the 5 year/100k coverage, so for me, the Geico option is like $500, vs the $3k from BMW. I know that Geico has a $250 deductible, but that seems like such a small price to pay for saving nearly $2500 by going with them.

Does anyone have any thoughs about this?
I decided to do the same thing as you. I went with the geico extended. Haven't had to use it yet as I'm still under Bmw warranty.
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      02-12-2014, 12:44 PM   #4
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This is most likely a scam. How can they cover anything when the fee is only $100 a year and so few people elect it? Any repair on a BMW (or any car really) is going to reach 4 figures easily. Another one of those too good to be true deals.
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      02-12-2014, 12:56 PM   #5
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Yeah I would carefully read the fine print.. like very carefully. I am guessing there are limits, or some deductible or its very specific to where you can get it repaired.
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      02-12-2014, 02:36 PM   #6
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Quote:
Originally Posted by ft1330 View Post
This is most likely a scam. How can they cover anything when the fee is only $100 a year and so few people elect it? Any repair on a BMW (or any car really) is going to reach 4 figures easily. Another one of those too good to be true deals.
The thing is, they have such a large consumer base to aggregate the premiums out that it makes sense - basically they're combining this warranty with people with Civic's and Altimas and every other car out there - actuarially, I can see where the premium makes sense. Not to mention they do sneak this coverage onto people's bill, which might help with the premium reserving for the claims. And believe me, state DOI's wouldn't let it go through if it was a scam - it would get struck down so fast and Geico would get hit with market conduct fines if they didn't follow through (I know this from working in insurance already). But I definately see your point - it does almost seem too good to be true.

There's been some discussion about it in the E90 boards as well as a ton of other makes/models, and it seems to be legit from what I see. You take the car to the dealer, tell the service department to call Geico to get paid, and then you just pay the dealer $250 out of pocket. Seems simple enough, and I can't really find complaints online about it...was hoping someone with past experience might see this.
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      02-12-2014, 02:38 PM   #7
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Originally Posted by Philipangoo View Post
Yeah I would carefully read the fine print.. like very carefully. I am guessing there are limits, or some deductible or its very specific to where you can get it repaired.
The interesting thing is that it's an insurance policy, not a warranty - warranties lay out what's included, and insurance contracts lay out what's excluded - in this case, Geico says that only wear and tear items are excluded (ie, fluids, tires, etc). So from a high level coverage, it's actually more comprehensive than the Platinum BMW warranty - whether it's implemented that way is my question.

I did confirm with Geico that there is a $250 deductible per issue - so if you're AC compressor and your radiator break, it would be $500 deductible. It does not show up as a loss on your CLUE report though, so it will not impact future insurance rating.
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      02-12-2014, 03:30 PM   #8
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Originally Posted by marlin2911 View Post
The thing is, they have such a large consumer base to aggregate the premiums out that it makes sense - basically they're combining this warranty with people with Civic's and Altimas and every other car out there - actuarially, I can see where the premium makes sense. Not to mention they do sneak this coverage onto people's bill, which might help with the premium reserving for the claims. And believe me, state DOI's wouldn't let it go through if it was a scam - it would get struck down so fast and Geico would get hit with market conduct fines if they didn't follow through (I know this from working in insurance already). But I definately see your point - it does almost seem too good to be true.

There's been some discussion about it in the E90 boards as well as a ton of other makes/models, and it seems to be legit from what I see. You take the car to the dealer, tell the service department to call Geico to get paid, and then you just pay the dealer $250 out of pocket. Seems simple enough, and I can't really find complaints online about it...was hoping someone with past experience might see this.
Well, I used the term "scam" in the wider sense, not in the sense of an obvious criminal activity. As in, they would have you believe that everything is covered except for the wear and tear items, and the fine prints are worded in such a way that it may seem that way, until you try to use it and you realize that there are huge exclusions. With insurance you don't know how bad it is until you really try to use it...

That's why I don't understand people who review insurance companies and they never made a claim. Basically it's like reviewing how quickly and efficiently they bill you. Usually this is done very well.

I was also unable to find reviews of people who actually had to use it. First your car needs to be out of its warranty... This may take a while to get feedback on this.

I guess one obvious limitation is that you need to buy the coverage in the first 2 years, and have an uninterrupted GEICO insurance policy on the car for as long as you want this coverage. If they jack up your rates and you want to move out you lose the coverage before you could actually use it. It's great for them because it ensures forced loyalty. Not so great for you, especially that I found GEICO to be the most expensive insurer in my case.
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      02-12-2014, 03:39 PM   #9
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On my current car, '09 Infiniti g37x (my f30 should be here in a week) I have Geico's mechanical breakdown. It came it very handy when after my warranty period was up, both power locks to my driver and passenger side doors broke. I had to climb through the back to unlock it. All it cost me was the $250 deductible, but that was it. Now granted, i have been paying for this in my premium since I purchased the car. I believe it has to be added added when the car is first purchased and insured. 7 years/100,000 miles on anything in the car that can break.

I will again have it on my new f30
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      02-12-2014, 03:46 PM   #10
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Originally Posted by livewyr25 View Post
On my current car, '09 Infiniti g37x (my f30 should be here in a week) I have Geico's mechanical breakdown. It came it very handy when after my warranty period was up, both power locks to my driver and passenger side doors broke. I had to climb through the back to unlock it. All it cost me was the $250 deductible, but that was it. Now granted, i have been paying for this in my premium since I purchased the car. I believe it has to be added added when the car is first purchased and insured. 7 years/100,000 miles on anything in the car that can break.

I will again have it on my new f30
Did you deal with the dealer to get everything taken care of? It looks like there isn't an issue with that, but a 1st hand experience is great.

And yea, you do pay for it before you can use it, but no different than buying the extended warranty upfront either. It's just the $2500 difference that's really catching my eye.
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      02-12-2014, 03:50 PM   #11
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Yeah, you can go to any licensed repair shop you want. I just happen to bring it to the dealer i bought it from.
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      02-12-2014, 03:52 PM   #12
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And the best part was I was unaware that I even had the mechanical breakdown at the time. I used to be under my parents policy and when i moved out i just told them to give me what i had under their policy. Geico sent me a check for the difference.
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      02-12-2014, 04:10 PM   #13
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Quote:
Originally Posted by ft1330 View Post
Well, I used the term "scam" in the wider sense, not in the sense of an obvious criminal activity. As in, they would have you believe that everything is covered except for the wear and tear items, and the fine prints are worded in such a way that it may seem that way, until you try to use it and you realize that there are huge exclusions. With insurance you don't know how bad it is until you really try to use it...

That's why I don't understand people who review insurance companies and they never made a claim. Basically it's like reviewing how quickly and efficiently they bill you. Usually this is done very well.

I was also unable to find reviews of people who actually had to use it. First your car needs to be out of its warranty... This may take a while to get feedback on this.

I guess one obvious limitation is that you need to buy the coverage in the first 2 years, and have an uninterrupted GEICO insurance policy on the car for as long as you want this coverage. If they jack up your rates and you want to move out you lose the coverage before you could actually use it. It's great for them because it ensures forced loyalty. Not so great for you, especially that I found GEICO to be the most expensive insurer in my case.
I actually requested the contract and read it through - contractually, it really is as good as it seems. Only exclusions are really for tires and fluids - actually spelled that out in the contract as well. I think I'm going to go with it...I think willing to accept some small risk to save $2500 in this instance.

At least for me, Geico has been the least coverage option availabile for my wife and I, based on the limits I chose. I do quote very year (would prefer to go with my employer, Chubb, but we're just too expensive in NJ to be competitive) just to make sure.

I do appreciate the discussion though and the skepticism - I've definately been skeptical myself.
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      02-12-2014, 05:00 PM   #14
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Quote:
Originally Posted by marlin2911 View Post
I actually requested the contract and read it through - contractually, it really is as good as it seems. Only exclusions are really for tires and fluids - actually spelled that out in the contract as well. I think I'm going to go with it...I think willing to accept some small risk to save $2500 in this instance.

At least for me, Geico has been the least coverage option availabile for my wife and I, based on the limits I chose. I do quote very year (would prefer to go with my employer, Chubb, but we're just too expensive in NJ to be competitive) just to make sure.

I do appreciate the discussion though and the skepticism - I've definately been skeptical myself.

I've been looking into the Geico Mechanical Breakdown Insurance for a while now, and I plan to go with it. BTW, you can purchase this additional coverage up to 15 months or 15K miles from the date of purchase. It's very important that this is an exclusionary contract as was stated above. That leaves very little wiggle room for the insurer; if your issue is not on the excluded list you're good to go. I wasn't able to get a hold of the actual contract, so thanks to Marlin2911 for doing that. If you do a web search you don't find (m)any complaints about the Geico MBI. That's impressive for a large nationwide company. Also, the coverage is good for as long as you own the car, unlike the 7 year/100K EW from BMW. Since I plan on owning the car for longer than seven years, that's relevant to me.

Comparing the Geico MBI to the 7 yr./100K EW: If I pay $163 for 5.5 years (waiting the 15 months), that's $896 for the first seven years compared to $3K for BMW EW. Let's say over years 5-7 I have eight insurable incidents, so that equals another $2000 in deductibles. That brings me to pretty much a dead heat with the $3000 EW from BMW. But then I have the option of keeping my car covered after that, which is not an option with BMW. I don't know how many people keep their cars 7+ years in the BMW world, but it works for me. Or, if I do sell before that I only pay the MBI premium for as long as I own the car and that will save money compared to the upfront payment to BMW.
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      02-12-2014, 05:27 PM   #15
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Not sure about the extendablilty (or at least in NJ), as for us it states 7 years / 100k on the Geico MBI. I've included the NJ contract to this post if anyone wants to read.
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      02-12-2014, 05:59 PM   #16
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Originally Posted by marlin2911 View Post
Not sure about the extendablilty (or at least in NJ), as for us it states 7 years / 100k on the Geico MBI. I've included the NJ contract to this post if anyone wants to read.
I asked the representative on the phone specifically about extendability beyond seven years, and he affirmed it was for the full time of ownership, but I will double check. I also need to check if the MBI can be obtained if you're not a Geico member at the time you purchase or get delivery of the car.
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      02-12-2014, 09:00 PM   #17
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Originally Posted by marlin2911 View Post
Not sure about the extendablilty (or at least in NJ), as for us it states 7 years / 100k on the Geico MBI. I've included the NJ contract to this post if anyone wants to read.
You're correct. I called Geico again and the first information I got was wrong. It's good for 7 yr./100K miles. I'm looking into BMW's Gold EW again. I just called Daniel Dutton at Pacific BMW and he quoted $2340 for 7yr/70K miles or $2690 7yr/100K (for a 328d). He also said the rates don't go up until you've put >10K miles on the car.

Edit: Another advantage of the Geico policy is that you can use independent shops as well as dealers; BMW EW only allow dealership service.
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      02-13-2014, 12:10 AM   #18
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I've used geico mechanical breakdown insurance at least 4 times for various issues with my vw and Plymouth and there was no hitch at all. Pay the 250, they pay for the repair at the dealer. Amazing. Of course I went with this for my 328s instead of some silly extended warranty.
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      02-13-2014, 12:46 AM   #19
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Another strong contender is the Costco Vehicle Protection Policy (you have to be a Costco member). The nice thing about their policies is if the policy is stated to be (for example) for 5 yrs/50K miles, that starts AFTER your current warranty expires--it does NOT begin when you buy the car. Costco is currently revamping their rate structure for 2014 so they won't be able to give out quotes for a couple of weeks.

I prefer either the Costco (known to be a good value) or the Geico policies over BMW EW.
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      02-13-2014, 02:25 AM   #20
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For the F30 (and similar 'luxury' vehicles), Costco will only offer the EW if the vehicle has less than 10k on it. Was going to purchase it for my 911 when the CPO ran out. No longer possible.
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      02-13-2014, 02:33 AM   #21
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After reviewing the contract, I went with Geico Mech Breakdown policy when I bought my car. At less than $600 over the course of 7 years ($84 per year for me), versus $2900 that the dealer wanted to charge me to get to 7 years/100k, it seemed to make sense. Of course, it's a $250 deductible versus a $50 deductible for the BMW coverage. But I'd have to get to 12 mechanical breakdowns after the 50k standard warranty for it to make it less cost effective than the BMW extended warranty. If I get close to that, I'd get rid of the car!!!

And further, the Geico coverage covers items more than the BMW extended warranty... For example, the Geico coverage will cover things like blown coolant hoses, whereas the BMW coverage won't (as I found out on my E90 with the extended warranty). So, overall, the Gieco coverage seemed the better move.

I've been insured with GEICO for about 10 years. I had a string of bad luck/bad decisions (4 accidents last year, 2 of which were my fault where they paid out about a total of 50k). My rates recently went up a bit ---by about 400 per year--- but I stick with them because they have great customer service and really took care of me and my car even when things were my fault.

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      02-13-2014, 09:13 AM   #22
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For the F30 (and similar 'luxury' vehicles), Costco will only offer the EW if the vehicle has less than 10k on it. Was going to purchase it for my 911 when the CPO ran out. No longer possible.
Hmm, I was told that you could insure at any time--even after your OE warranty has expired--but that the rates go up substantially after 10K miles. But we didn't discuss the model car I had because he wasn't able to provide a quote at the time. I'll call back and double check.
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