Ever wonder what phone insurance is and if you should buy it? Or whether cell phone insurance is different from the manufacturer’s warranty? And is it better to purchase phone protection from your service provider, an insurance company, or the phone manufacturer?
These are all good questions. But, first ask yourself this one:
How much do you like to gamble?
Personally, I don’t like games of chance. However, here’s a cautionary tale about a time I overestimated my odds.
Almost 5 years ago, my husband and I bought smartphones for our family. Four brand-spanking-new phones rang up quite a bill. We trusted the manufacturer and decided to skip the extended warranty and phone insurance. Bad idea. Just months after the warranty expired, one phone died.
As we learned the hard way, there are times when springing for insurance can save money down the road. Now we know: We should have done our homework before we dismissed insurance or an extended warranty.
Insurance vs. warranties
The manufacturer’s warranty covers problems like the phone not performing as it should. But it doesn’t usually pay for lost, stolen, or physically damaged phones. That said, some warranties do cover accidental damage from handling, so check yours carefully. Extended warranties let you continue this coverage beyond the first year.
Smartphone insurance usually covers lost, stolen, and damaged phones. And some—like the company AT&T uses, Asurion—even cover liquid damage. Again, make sure you read your policy to learn about the coverage you have before you need it.
Remember, you may have to pay a deductible if you make a claim. Some policies have deductibles that decrease if you don’t file a claim for the first 6 or 12 months.
Where to buy insurance
If you decide you want insurance within 14 days of buying your phone, you’ll have plenty of options. There’s the manufacturer, your mobile service provider, and independent insurance companies.
Service providers, like AT&T, make it easy to purchase protection and pay for it over time on your monthly wireless bill. You need to buy insurance within 30 days of activating your phone.
You can also buy insurance from your phone manufacturer. A big plus: Their plans might come with technical support by phone, in a store, or through online chat.
Buying insurance from an independent insurer gives you more flexibility. If your phone’s working and in good condition, you can sign up any time. You might even be able to negotiate a discount if you insure other appliances, cars, or your house through the same company. It never hurts to ask.
Do you have a homeowner’s or renter’s insurance policy? Check to see if it covers your smartphone.
Things to consider
Know your odds. According to Asurion, 1 out of 5 people will have a lost, damaged, or stolen phone each year.1
If you decide to protect your smartphone, check out all your options.
- How soon: Consider whether it’s more important to have a plan with same-day replacement service, or if you can bear to be without your phone for an extended period.
- How to: Check out online reviews to discover how easy it is to make a claim.
- How long: Find out if you can cancel your insurance plan any time or if you must commit for a period of time.
- How much: Weigh the monthly premium costs against your deductibles. If you’re a wise gambler, you can opt for a cheaper premium with a larger deductible because you won’t have to make a claim, right?
As a student of the school of hard knocks, I know it’s wise to insure your smartphone. Insurance can turn a smartphone nosedive into the swimming pool into a minor inconvenience, not a major drain on your finances.
1 Stat from asurion.com/phone-insurance/
This article was written by an AT&T employee. The postings on this site are my own and don’t necessarily represent the positions, strategies, or opinions of AT&T.