Smartphone Insurance

Apple iPhone submerged in water

Smartphones can be expensive. Especially if you break one. Manufacturer warranties are okay, in that they will protect from mechanical defects for a set period. They rarely, though, cover you for accidental damage. Even the extended warranties that stores will try and sell to you at the counter only extend to the mechanics, and not the accidental issues that might come up.

So what do you do? Do you take the extended warranty on offer, or are there better alternatives?

Hand gripping smartphone with broken screenWhat Your Warranty Provides

In the US, each state has its own version of consumer law, which can make dealing with faults very difficult. In most cases, you will need to deal directly with the manufacturer, which means sending your phone to them if there’s an issue. This is different to, for example the EU, in which your contract is with the seller, not the manufacturer. If a fault occurs in the first year or during any extended warranty period the seller has provided, it is up to the seller to solve it. In the US, though, it isn’t so easy.

But, for all that, you do at least have some cover for the first year or, sometimes, longer. Once out of guarantee, you are either stuck with paying for repairs yourself, or replacing the phone. Neither option is cheap, which is where buying a third party warranty or insurance policy can be a good idea.

With extended warranties at the point of sale, there is a massive gulf between the pros/cons of taking it. Sometimes, the cost of a 2 year extension can be about 50% of the cost of a new phone. Is it worth the layout? Only you can answer that. In some cases, it’s so cheap as to be a no-brainer, but do your sums before just accepting it.

Types Of Policy

Assuming you haven’t taken the extended warranty on offer, you will need a specialist insurance policy. In effect, this is no different to homeowners or car insurance, except it applies only to a single item. It might actually be worth checking with your current homeowners insurance company to see if your phone can be added to the policy. In many cases it will cost less than going to a specialist tech insurer.

4 smartphones with cracked screen bounding on roadIf you can’t add it to your home insurance, then one of the many tech or gadget insurers might be your only choice. These generally represent reasonable value, depending on the purchase value of the device. Some network carriers, like AT&T, Verizon and others, will offer cover, but you may need to have bought the phone from them. It’s certainly worth checking the details, if you have a contract for both phone and airtime.

What To Look For

Believe it or not, not all tech device insurance policies cover for theft or loss. Although the number of providers who don’t is shrinking, you must ask the question. They will all cover accidental or water damage, however. There may also be a limit on how many claims you can make in a single year.

You can also be sure that there will be a deductible to pay. The level of this may depend on the phone you have. iPhones notoriously carry a premium deductible in most cases, so be warned. This is another bit of math you’ll need to do to see if the deductible makes it a less attractive option based on you replacing the phone yourself.

Providers

As well as the airtime providers, there are lots of 3rd party insurance providers. Protect Your Bubble are one of the largest coverage providers. They are also one of the cheapest, but there are limits to the cover they offer. They don’t, for example. usually cover for loss without extra cost on top. Theft is covered, though, as is accidental damage and the price is reasonable enough. If you are more likely to have your phone stolen than to misplace it, it might be one of the better options available.

SquareTrade are another budget provider. They also don’t cover for loss, or even theft, but they are one of the cheapest in terms of monthly cost and the deductible required. They also offer discounts for insuring more than one phone, or taking cover for multiple years. Only one replacement phone per year is allowed, however.

Insurance Claim FormFor one of the most comprehensive cover packages available, GeekSquad provide an excellent service. Although more expensive than either Protect Your Bubble or SquareTrade, they will cover your smartphone against just about any mechanical, loss or theft problems. Geek Squad also do multiple year cover, and you can transfer the policy to someone else if you sell the phone.

Asurion are a mainstream insurer who also have a very active phone insurance side. The only restriction is that you must have an airtime contract from a network on their an approved list. In  most cases, this will not cause problems. They offer next day replacement for a whole host of coverage options. Everything from theft/loss to mechanical breakdown is fully covered. Again, you will need to think about the deductible, though. Asurion have the backing of a major company, but this does reflect in both their monthly cost and the level of the deductible.

Finally

Any insurance policy is only as good as the company which provides it. In many cases, there will be strict rules you need to follow in order for any claim to be valid. Negligence is usually a big red flag for insurance companies, and they usually have a clause which says you can’t claim if you’ve been overly careless. And that’s careless by their definition of the word, not yours.

In all cases, read the small print before agreeing to anything.

Rachel C.
Rachel C.
Rachel is the researcher and blog writer for the Mr Aberthon website. She grew up in Brooklyn, New York and eventually made her way to Connecticut in order to become a part of the Mr Aberthon Team. She is passionate about technology and electronics, and nothing gives her more pleasure than discovering insights into the latest gadgets to hit the electronics market.