Life is full of unexpected events and some of them might also be unfortunate. That’s why we have insurances for our cars, houses and even for our health and lives. That’s the least we can do, at least to financially insure our properties, hoping that we’ll able to retrieve part or the entire amount. We carry our phones daily with us and there’s a fair amount of important information inside them, as well.

But, besides that, the devices themselves represent quite a value – many of them having a price well above $500. So, this brings up the question: should or should we not have a cell phone insurance to protect our valuable gadgets? The answer is not a definite one and doesn’t apply equally to everybody. It’s all about money, needs and expectations.

phone insurance

Cell phone insurance: what you need to know

If you’re a businessman who carries a lot of sensitive information, then you put a lot of value on your device. While there are slim chances that a cell phone insurance will help you recover the precious data inside, at least you can be sure that you will recoup the money you paid for the smartphone. Let’s analyze and see what are the best options and if they are really worth the effort, time and money put in.

Deciding whether or not you need a cell phone insurance is not a question that we can answer straight away, but we can perform an analysis to see how the entire thing actually happens. Here are some important things that you should know before getting that mobile phone insurance.

The devil is in the details

If there’s one word that can describe insurance companies very well, then it should be this – details. Recently, my car got hit by somebody and I had to make use of the CASCO to repair it at the shop where I first bought it. Only then did I learn that if after an accident, the door gets jammed, you should not open it, because you’re going to increase the damage done to the car. Of course, this is nonsense and it’s nothing more but a clever trick done by the insurance company to reduce the evaluated damage.

But you’re probably thinking that the insurance for a cell phone should happen in much more simple and “human” terms. Wrong. Whenever you see the word “insurance”, be 100% sure that you have read everything there is to be read and analyzed. And a phone insurance contract can be as long as 9 pages. You should be paying a lot of attention to the following points:

  • Whose fault was it? Just like with cars, where you have compulsory insurance that covers up the damage done by others, you have the choice of using CASCO to repair the damage inflicted by yourself, thieves and even natural disasters. With cell phone insurance, you should check to be sure whether you’ll get back the value of the phone even if it was your fault. Because, otherwise, it doesn’t really make sense. Dropping your phone on concrete, water or stepping on it happens so many times
  • Carrier, dedicated or a regular insurance company? This is another trick that you need to master prior to signing the documents to insuring your phone. Most of the time, your carrier will offer you a separate insurance plan. Don’t rush and accept it right away. What you can do, is to compare what your carrier might be offering with what a regular insurance company or dedicate phone insurance one has for you. Sometimes, you’ll be surprised to notice that regular insurance companies might charge you less.
  • What does it cover? You also need to carefully check for what causes of damage the insurance company will be willing to give you back the value in money of your phone or give you another one. Ideally, your phone insurance should cover the following: accidental damage (whether you or someone else drops it); worldwide cover (very useful if you travel often); theft; loss (check some other methods you could try to recover a lost iPhone). If you’re really looking for that phone insurance, then carefully read to find the best and cheapest one.
  • Money or another phone? Just like we mentioned above, you need to check from the beginning what do you want in return – the full amount of the insured device or another one in return? Sometimes, the insurance agency will most likely give you just a replacement phone which, might not be the one you insured. I know it sounds stupid, and that’s exactly why you need to be prepared.
  • Maximum cover & standard excess. Maybe you don’t have a regular phone, maybe it is covered with a gold case and filled with diamonds. Or maybe it just represents the latest and the greatest there is in the mobile industry. You need to know what the maximum cover is, which represents the maximum amount of money you will be entitled to get if an unfortunate even happens. Another “trick” that the insurance company uses is the “standard excess“. In plain English, this is the part of money that you will pay prior to the insurance plan. Some phone insurance companies will have an excess that will be different from phone to phone; therefore, while the majority will charge around $50 from your side, some might even request $100, if we’re talking about premium phones.
  • Repair days, shipment, handling. When something is broken, the last thing you want to do is to spend a lot of time with your gadget here and there. You need to have it taken right from your door and repaired as fast as possible. Look for a mobile phone insurance company that promises to solve fast and responsibly your issue. We’ll be sharing a few of them lower in the article.
  • Number of claims & increase of monthly rate. What if, during a single year, all of the following happens to your phone: it gets stolen 2 times, you lose it once in that wonderful park, your daughter cracks it screen and your dog partially destroys is. The insurance company is obviously losing some money with you, so it’s expected that they’re going to charge much more when you come the second or the third time in a short period of time, like one year. Also, some might even increase your monthly rate if you had any unfortunate events the previous year. Do look out for these important details.
  • Should I insure my tablet, as well? Phones are not everything we have. Actually, most of us now have smartphones. And chances are, that if you have a smartphone, you might already own or looking for to get a tablet. You could insure that, as well, and probably get a discount with the insurer.

Let’s do some math

I hope that I didn’t scare you too much by outlining just how many things there are when trying to insure your mobile phone. And you’d think that $5, $10 or even $15 per month is not such a big deal, but when you think in terms of years, you’ll realize that you’ll probably end up paying quite a lot. It all boils down to your own needs, preferences and … luck. As I see it, a phone or tablet insurance, if you will, is efficient as long as you lose or have your device broken in the first months.

phone insurance plan

Another important thing to keep in mind is that some phone insurance companies might work with your carrier, so you could have your lost or destroyed phone replaced and without having to deal with the carrier at all.

Therefore, when picking up a phone insurance agent, carefully check if it supports your carrier, even if it might be a local one. Depending on where you live, different phone insurance plans might be present, but we’ll take USA standards as a reference.

Before selecting your cell phone insurance plan, you need to carefully calculate how much you’ll end up paying for this useful service. There are 2 big options: a one time single payment or a monthly, recurrent payment. Just for the sake of the example, let’s say that you’ve found that right insurance plan that is OK according to all the above mentioned points. You will be required to pay monthly $8, which means you’ll end up paying in 2 years almost $200. And, let’s say that you have the latest iPhone, so let’s add to that $100 more. Therefore, if after 2 years, your phone is still with you, safe and sound, you’ll end paying $300 for a service that you had never used.

There are cheaper alternatives, though, that consumers might start to like – a one-time payment. No monthly bills, no excess fees or other shady details. The disadvantage with this method is that you have to pay more from the start. But they also have a trick – you’ll have  to pay a deductible fee every time you file a claim, which ranges usually from $75 to $150. But there’s a much more simple, yet useful solution.

Make your own emergency fund

Overloaded Piggy Bank

photo credits: RealEstateWagga

I sometimes fail to understand why people give so much money each month to private or governmental pension funds. I guess they’re doing it for their peace of mind, but I, for one, see more sense in putting aside money that you will control. Why not just create a deposit account and put there all the money, instead of handing it over to others? You could do the same thing when it comes to insuring your phone. Putting aside $10 dollars every month can do wonders if you lose your phone, at least for your own peace of mind.

There are obvious drawbacks, of course, such as the hassle with your carrier. But, at least, you know that you’re not giving your money to somebody else and if nothing happens, you don’t lose money. If fate is on your side, you could very well insure your phone your way and not paying up for a service that, as I have already said, might not help you at all.

Reliable phone insurance companies

The decision is all yours, we’ve only tried to bring up all the pros and cons of this ardent question – “should I have phone insurance?”. Of course, you need to take a look at some of the best offers that there are in the industry. But at this moment, you already know what you should be looking for and how to avoid the commonly used tricks in the insurance field. Let’s have a look at some cell phone insurers that seem to be la crème de la crème.

  • Asurion – this is called by many as the leading and most popular company in the phone insurance business. Perhaps that’s why they have added extra features to make those craving for security flock in – protected privacy, antivirus, anti-malware and anti-phishing. Besides that, you can also find and lock your phone if it gets lost or stolen. However, if you’re only interested in insuring your phone, do check out their offer and request a personalized quote.
  • Square Trade – I first heard about Square Trade on Youtube, where they used to drop smartphones in order to see which one is more durable. A real nice way to get promotion among consumers. It has a very good rating, but it won’t cover you from loss or theft, which is  a big drawback. The 2-years protection plan requires a one-time payment of $125 or $7 per month + a $99 deductible fee applied to all claims. The plan covers the following: drops, spills, mechanical, electrical, touchscreen, wi-fi, antenna, display failures and problems with the connector port and power on button.
  • Ensquared – Ensquared is another reliable phone insurance company that promises to take care of your devices. It has different insurance plans, according to the type of your device: iPhone, iPad,  plan for smartphones and tablets. A 2 year protection plan for smartphones (no iPhone) will also cover loss and theft. You will have to pay a one-time fee of $100 and a $75 deductible fee per claim. You can fail as many as 3 claims (an additional amount of $25 is applied) with a maximum cover of $1000.
  • GoCare - this is another insurance company that deals with phones, tablets and laptops. You need to head to their website to get an exact quote for your model of phone, but the company says that prices start from $59 per year. Insurances from GoCare also have the role of extended warranties.
  • ProtectYourBubble – you will have to select from the drop-down menu to find out what’s the monthly quote for your exact model, but it should be around $8 per month.  You will also have to pay a deductible claim fee, as follows: $75 for basic phones and tablets, $100 for smartphones. $120 for iPhones. The reason why iPhones are more expensive is probably because they are harder to repair and have non-removable batteries.

There are many other phone insurance companies that can do a great deal protecting your phone. You can also check with your carriers and see whether their terms might suit your not. Depending on where you are living, you might have similar or even better insurance plans for your phone. But now, you are armed with the most useful gun there is – information. Good luck in finding the right insurance plan or the no plan at all!

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PHOTO CREDITS: Peyri
 
Managing Editor

is the Managing Editor of Technically Personal. When he has some extra-time, he writes about Windows 8 apps and reviews them on Wind8Apps. Believes that technology is the main engine of civilization. Send him a tweet or make him your Facebook friend