s Cell Phone Insurance Worth It?

Is Cell Phone Insurance Worth It?

Anyone who has ever owned a cell phone understands that the phone takes a beating over time. Issues such as faulty buttons and cracked screens often lead to people shelling out large sums of money to either repair or replace their smartphone. These mishaps have given rise to phone cases and screen protectors; however, another option to protect the phone is insurance. When people hear this word, they often want to know whether cell phone insurance is worth the monthly cost.

Is Cell Phone Insurance Worth It: The Factors

There are several factors in play that people need to consider carefully before investing in cell phone insurance. These will often determine the "hidden cost" of investing in cell phone insurance.

  • The Deductible: People always need to consider the deductible on the policy since they are already paying a monthly premium. If the deductible is high enough to approach the cost of replacing the broken part of the phone, it might not be worth it. If the deductible is minimal, this could mean the policy is worth the cost.

  • The Policy Restrictions: Many policies have restrictions regarding what parts can be replaced. If these restrictions make it impossible to use the policy, it isn't worth it. If the restrictions are minimal, the policy might be worth it.

  • The Replacement Options: Customers need to make sure that there are adequate replacement parts and tools for their device. Ask about the availability of parts for a specific phone before investing in an insurance policy.

Is Cell Phone Insurance Worth It: The Options

The next question people ask is about the options. Below are some of the pros and cons of cell phone insurance plans. 

  • Verizon: Verizon offers a relatively standard cell phone insurance plan for people to invest in. The monthly premium is $11 per month and covers phones that are lost, stolen, or damaged. The replacement deductible ranges from $49 to $199 depending on the price of the device. For people that need replacement of a cracked screen, the deductible is $79. The monthly premium is a little higher than the industry average but the deductibles are also slightly lower than other insurance plans.

  • Best Buy: The Best Buy cell phone insurance plan is furnished by the Geek Squad arm of the company. It has a slightly larger range of coverage than the Verizon plan because it covers drops, spills cracks, battery damage, mechanical failure, accessories such as chargers, and normal wear and tear. The plan is even transferred to another client should the phone change hands. All of these features cost $7.99 per month, slightly lower than the industry average. If people want loss and theft covered, the rate increases to $10.99 per month. The downside to this plan is that price of using the plan. The deductibles, or service fees, can run from $150 to $250 depending on the price of the device and the plan. It is important to note that Geek Squad DOES NOT offer coverage for iPhones. 

  • AT&T: The AT&T mobile protection insurance costs $7.99 per month and covers lost, stolen, or damaged devices. This damage includes physical damage and liquid damage. One of the biggest benefits to this plan is the fact that deductibles decline over time as people pay their premiums to half of their starting value after 12 months. The downside is that the plan is more limited in its scope compared to the other plans and that the plan limits people to two claims in twelve months. 

 

Verizon

Geek Squad

AT&T

Premium

$11/month

$7.99/mo or $10.99/mo

$7.99/mo

Deductibles

Range from $49 to $199 depending on the device.

 

Cracked screen is $79.

Range as high as $250 depending on the device and the part.

Decline over time to half of their starting value after 12 months. 

 

Deductibles start at $25 to $300 depending on the device and decline monthly from this point.

Coverage

Phone that is lost, stolen, or damaged

Covers physical damage, accessories, mechanical failure, normal wear and tear, and is transferable to another party.

 

Plan is more expensive to cover loss or theft.

 

****NOT OFFERED FOR iPHONES****

Phone that is lost, damaged, or stolen.

 

Limit of two claims in 12 months.

Is Cell Phone Insurance Worth It: The Alternatives

There are a couple alternatives that people should consider before investing in cell phone insurance.

  • The Warranty: Remember that many phones come with a warranty when the phone is purchased. These warranties may not cover everything, but they do cover most things and often last for up to a year after the phone is purchased.

  • DIY Repair: People can also repair their devices. The price of replacement parts and repair tools usually drops over time after a device is released, and there are detailed instructions available online to help with every step of the DIY repair.