will the engine be damaged if the timing belt breaks?

What size is the engine?

Subaru, • DOHC Interference • SOHC Non-Interference... So if it is a DOHC, then yes it would damage the valves.

The information I have is the later SOHC engines like this one are also interference.

It's much less EXPENSIVE to just change the timing belt than to deal with all the damages later,. Don't wait and put this off until the last moment, kind of like trying to squeeze the last miles out of a set of tires you know need replacement.... Some people on the forum will tell you that you can go 10 or 12 years, just inspecting the belt they say,. My advice is just replace it at the manufacturers recommended interval, 105,000 miles or 8.75 years whichever comes first... Don't cheap out on this, you're going to lose. Weather conditions, heat and humidity all play a factor.. AND, while you have all this apart, take a closer look at the water pump and thermostat..be sure to use geniune Subaru parts.... The labor is the most EXPENSIVE part of the job. One more thing, Subaru suggests changing the "super coolant" in the radiator at 105,000 miles as well.. Once that is done, you should be good for another 50,000 miles assuming you take good care of your car and don't race it . Who races a station wagon??

Yes replacing it at the manufacturer's specified mileage is a grand idea!