14

I just bought a smartphone. Family plan with wife and parents. The salesmen were trying to push an insurance plan, but with just a quick look down the exclusions it's pretty restrictive. At $8 per phone per month just for myself and my wife that would be costing me more than my renters insurance and I end up paying half the price of a replacement over the course of a 2 year contract. Makes my think there has to be a better way to insure my phones.

Are there alternatives to using the carriers insurance plan for my phone?

Andrew Redd
  • 557
  • 1
  • 5
  • 13

6 Answers6

39

Self-insurance. Pay yourself a premium, and if something happens - buy a new phone. I've been doing it since I started using mobile phones. Made a fortune off that self sucker paying the premiums and never needing the insurance.

John Bensin
  • 15,048
  • 3
  • 72
  • 112
littleadv
  • 190,863
  • 15
  • 314
  • 526
9

Some credit cards offer insurance on cell phones, if you pay your monthly bill with the credit card.

One credit card I'm aware of that does this is the Citi Forward card (which provides $250 in insurance after a $50 deductible), and the card has no annual fee. I'm sure others offer similar services.

From: https://creditcards.citi.com/credit-cards/citi-forward/

Cellular Telephone Protection

If you pay your monthly cell phone bills with your Citi® credit card and your cell phone is damaged or stolen, you have supplemental insurance coverage that reimburses you for a replacement phone.

And the fine print

Visa Cellular Telephone Protection is supplemental reimbursement and is underwritten by Indemnity Insurance Company of North America. Certain conditions, restrictions and exclusions apply. Coverage is subject to a maximum reimbursement amount of $250 in excess of the $50 co-payment you are required to pay. Details of coverage will be provided upon cardmembership.

Dan Carroll
  • 547
  • 3
  • 7
3

If you regularly lose, break or otherwise destroy phones, get a cheap one. Otherwise, follow littleadv's advice!

duffbeer703
  • 30,455
  • 54
  • 101
3

Just self-insure it. If I'd have been paying $8/month for insurance, I'd already have paid $240 in the 30 months I've had my iPhone. That's a lot more than I've paid for repair.

I broke my iPhone screen. Cost me a hundred bucks for a new screen (actually, just the glass over the front of the screen), including labor, from a little kiosk in the mall. So you don't necessarily need a full replacement if you break it, and a hundred bucks is a lot better than the four hundred a new phone would have cost.

Adam Jaskiewicz
  • 763
  • 8
  • 10
3

Self insure is a good option, but if you can't replace a $500 phone that you received at a subsidized price on contract, consider a different warranty outfit.

I hear good review of www.squaretrade.com. They will warranty most electronics for a one time fee that typically is cheaper than what our cell phone carrier is pushing. They also pepper my inbox with frequent 30% off deals.

UPDATE: Since I last wrote, I have let my squaretrade contract expire and I now have a rider on my rentes owners insurance.

  • Covers ANY electronics in my home (phone, TV, laptop, tablets)
  • Costs about $25/year, or $2/month
  • Does not count as a claim against my regular renter's policy
  • I forget the deductible, but there is one. Less than $100

I don't know how many times they will let me use it before my clumsiness gets it dropped from my policy, but I think I like the ease of the insurance rider better than another company to deal with.

MrChrister
  • 25,328
  • 10
  • 69
  • 133
2

Insurance on consumer electronics is usually a very high profit thing for the company. That's why they pressure you into it and pressure salespeople into offering it. That means it isn't likely you will reap benefit.

Every time you are offered insurance it is better to set aside that amount on a monthly basis towards a self-insurance fund. You can do this in Quicken or have an actual account with automatic transfers.

Of course... If you have an error-prone teenager, buy the insurance!

P.S. At a local electronics store I knew the salespeople were allowed to make up any price for the "extended warrantee" and could keep half as commission. The better dressed you were the higher the price they would invent. Turn down the multi-year warrantee? You'd instantly be offered a less expensive, shorter-term one.

TomOnTime
  • 143
  • 3