What is Phone Insurance? How it Works and Its Importance [Full Guide]

What is Phone Insurance? How it Works and Its Importance [Full Guide]

Jan 18, 2020, 6:53:31 AM Business

It is highly likely that your phone is your most precious possession. There is no wonder about that since we all tend to keep our photos, important files, secrets, notes, conversations, and many other things on our cell phones. With our smart devices getting smarter by the day, the cost of replacing or fixing them is becoming more expensive. Just the thought of losing all of our precious memories is terrifying and it is worth looking into what we can do to keep our smart devices protected.  

Luckily for us, phone insurance can save us from worrying too much about the cost of repairs and replacements. 

But what exactly it is, how does it work, and why is it important? Here’s the breakdown. 

What is phone insurance?

If you happen to have a bad history of losing or damaging your old phones, then the phone insurance might just be the perfect solution for you. When you purchase a cell phone, it will mostly be sold with a one-year warranty that only covers hardware malfunction and manufacturing defects. Most warranties won’t cover misuse or accidental damage. This is where getting additional phone insurance steps in, as it protects your phone against mechanical breakdowns, faults, and accidental damage to your device. Not all insurances cover the same things, so you need to know a little bit more about the different types of insurances.

Most basic phone insurances cover you in case your device is lost, stolen or damaged. Losing your phone could take place anytime; you could lose it at a concert, at the shop, at work, or simply when you wander off without it. Some insurance companies can cover that for you. However, a few companies will not claim a lost phone if the owner was irresponsible and careless. Theft is another important thing that is mostly covered by insurance companies since our phones are very prone to getting stolen. The best gadget cover policies will also compensate you for breaking your phone’s screen or dropping it. 

Some additional coverage would include: 

  • Worldwide coverage

  • Mechanical breakdowns and faults 

  • 48-hour guaranteed replacements 

  • Unauthorized calls 

  • Downloads 

  • Apps, games, files and other valuable content 

Why you should consider buying phone insurance 

Going for insurance isn’t always an easy decision as most of us like to think we can take good care of our belongings. 

However, these might be a few things to keep in mind when you are considering mobile insurance:

  • You cannot afford to replace your phone or accessories if they got lost or damaged, especially if it has taken you some time to save up to buy a new one. 

  • Your job or your life in general highly depends on your phone and you completely rely on your device in your everyday routines. That means you would need an instant replacement if your phone gets broken, lost or stolen. 

  • You have a bad history of losing or misusing your devices. 

If the above list doesn’t really apply to you, then perhaps phone insurance might not be necessary. If it does, then you need to consider all the available insurance policies to find the one that best suits you. 

How to buy insurance and how much it costs?

To get insurance for your mobile phone, you will either need to do it through your network provider or by looking into several third-party mobile insurance providers. Most insurers come with additional covers, such as extended warranties, worldwide cover and 48-hour guaranteed replacements. You can also purchase one insurance for more than one device, which will save you a lot of money. 

The cost of your insurance will depend on your phone model and the level of the cover you are choosing. Premium covers would generally cost you an average of 14.99 British pounds a month. But you can always opt for cheaper ones. For instance, you can get phone insurance that costs you only 5 British Pounds a month. It will all depend on what you are looking for and the policies of your choice. 

How else can you protect your phone?

If you do not think you need an insurance for your phone, then you need to look into the other available options. 

Here are a few alternatives: 

  • Home Insurance: your home insurance can cover your possessions away from your home. Personal possessions cover can protect you when you leave your home or when you travel abroad. Keep in mind that claiming them, however, will cost you a large sum of money. When you pay higher for your claims, your premium increases when you renew your policy. 

  • Warranties: you might not need to opt for a phone insurance if your phone is still under warranty. However, most warranties only cover mechanical problems. You will need to thoroughly check the terms and conditions before you decide not to go for an insurance

  • Self insurance: this kind of insurance requires putting an amount of money away in a savings account. You will do so every month to guarantee having money to cover for a lost phone or a damaged one. You might want to choose an account that gives you easy access to your money, and create a list of all the possible risks that could arise before you decide how much money you’ll be putting away.

  • Package bank accounts: some accounts ask you to pay a monthly fee, which might mean they include a phone insurance. Ensure that your phone is registered to have it covered, and carefully check the bank’s policy.

As phones and their technology becomes more and more advanced, they tend to hold much value and therefore cost us a lot. If you are prone to losing or damaging your smart devices, then looking into insurance policies might just be what you need to keep your phone protected. These expensive gadgets can cause a real hassle once broken or lost and you wouldn’t want your life on pause for a few days because of such misfortunes. Consider the above guide when you’re looking into insurance and what it entails. 


Published by Lavismichel Inkel

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