Is the Cost Cell Phone Insurance Worth It?Cell phones come in all different shapes, sizes and colors. Yet, while each brand has something different to offer, when it comes to insurance policies, they’re all too similar.

Whether it’s the latest iPhone or Android, cell phones are expensive. Insurance for these pricey devices isn’t cheap, either. After spending approximately $200 on a new phone (after signing up for a new two-year contract), $40 on a case to protect the phone, and $15 on a screen protector, you then have to decide if it’s worth it to purchase insurance for the phone.

Talk about a tough decision. At first glance, it might be an obvious decision to insure your brand new phone (costs range anywhere from $7–$15 a month). But, is it really worth paying $168-$360 for the two years you have the phone? That all depends on you.

There are many options to choose from when insuring your phone. You can go directly through the phone carrier, or stores such as Best Buy offer protection. Each of these options offer something different, so be sure to read the fine print. Really, really read the fine print, or you’ll be sorry in the end. Here are examples of insurance policies for your phone:

Verizon Wireless: Total Equipment Coverage – For $9.99 a month, a quick glance at Verizon’s policy states that you’re covered for loss, theft, damage, or mechanical/electrical defect after the manufacturer’s warranty expires. However, when you dive into the details, it reveals you’re not exactly covered for everything. For example, damage resulting from normal wear and tear isn’t covered. Water damage isn’t included, either. Continue reading the fine print and you’ll realize quite a bit isn’t covered.

Not only are there many loopholes, but you’re also responsible for as much as a $169 deductible to get a new phone. In many instances, you’re “new” phone is refurbished and comes from a company called Asurion, a global provider of wireless handset insurance and wireless roadside assistance programs.

While this might not sound like a great deal after all, keep in mind that purchasing a phone without a new contract can cost over $600. When you do the math, insurance for two years comes out to be approximately 239.76. Tack on the $169 deductible and you’re looking at a price tag of $408.76, which is still cheaper than paying at least $600 for a new phone. Keep in mind that if you damage more than one phone, you’ll have to pay another $169 for a new one. It’s complicated, right?

AT&T: Depending on the type of phone, you’re looking at a monthly fee of $4.99 with a deductible ranging anywhere from $50–$125, again depending on the type of phone. You’re allowed two claims per 12 months. Phones such as the iPhone are not insured specifically through AT&T, although you have the option of going through Asurion.

Best Buy: For the iPhone, you’re looking at $14.99 a month. Unlike the plans through Asurion, where you get a replacement usually within two business days, Best Buy can take up to three weeks to fix your phone. While Best Buy does give you a phone to use in the meantime, it’s generally one that only does basic functions such as call and text. Oh, and by the way, there’s a $150 deposit, too. ­­­­

When it comes down to it, the decision to purchase (or not purchase) insurance for a cell phone differs from person to person. If you find yourself constantly dropping, losing, or breaking your phone, an insurance plan is probably going to benefit you in the long run (although again, be sure to read the fine print to find out what’s covered). If you’ve never had any problems with keeping your phone in good condition for the two-year contract duration, save your money and put it toward getting a new phone when the time is right.

Do you think cell phone insurance is necessary or a waste of money? Let us know in the comments section below!

 

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