How much are we really paying for cell phone insurance? Most people don't realize that along with the $3-$5 monthly charge they are also required to pay an additional deductible of $35-$100 when making a claim against a lost, damaged, or stolen phone! Most of the free phones given away by the carriers would cost around $75- $150 if purchased them without a plan.
Let 's do the math. If I am able to keep my phone safe for a year I have paid $60 for insurance that really amounted nothing. What's worse is that if I had had to make a claim on the phone, when I add twelve months of $4 insurance to a $50 deductible, I'd be paying more than what the phone was originally worth. Now I know what you're thinking: What if I purchase a Treo 650 or some other expensive phone? Wouldn't insurance be worth it then? Well the answer is simple. Most carriers don't offer insurance on Treos and other PDA-style phones.
Here's the real kicker if you have to make a claim: Most carries do not insure the phones themselves. The big carriers use third party insurance companies. This means that you have to call the insurance company instead of dealing with the service provider you've contracted with. OK, so you make the call and deal with the insurance company only to find out they don't have your phone in stock. Then it turns out that your phone is no longer available, which we've been told happens more often than you'd think; most insurance companies will not stock phones that are only six months old. Instead you are sent a phone that the insurance company deems "comparable".
Comparable is one of those subjective words that should immediately send up a red flag in your mind. What if you don't like the phone? What if you like your Motorola and now they've sent you a Nokia? What if you purchased accessories for your phone and now they won't work with your new replacement phone? These are just a few of the potential hassles you may face when dealing with cell phone insurance.
It's our opinion that purchasing insurance for a phone is simply not beneficial in anyway. Between eBay and our very own cell phone market place , there are many ways to find a replacement phone that fits your needs and budget should you find yourself with a broken phone that's out of warranty. Don't spend your money on monthly insurance payments; save it for that rainy day that hopefully won't ever come.
Many people wonder, why would I need insurance if the phone comes with a manufacturer's warranty? The answer boils down to three words; lost, stolen, and inconvenience.
Lost
If you lose your phone, the manufacturer's warranty will not help you. If you're paying for insurance on your phone, the insurance company may replace the phone depending on the options you chose when you purchased your phone and service.
Stolen
If your phone is stolen, the manufacturer's warranty will not help you. If you have insurance, the insurance company should replace the phone; however, many of the insurance companies will require a police report and possibly other proof of the crime before replacing your phone.
Inconvenience
If your phone breaks within the warranty's allotted timeframe, you should be able to get a replacement from the manufacturer provided that the problem was caused by a defect and not negligence on your part. Be sure to keep your original receipt and packaging that came with the phone in case you need them to submit a warranty claim. The major inconvenience you?ll likely experience is that you'll be without a phone during replacement, which can take upwards of 60 days. Obviously, most people can't be without a cell phone for such a long period of time; you might consider purchasing a basic, inexpensive phone to keep as a backup in case you need to primary phone back for repair or replacement.
Our Advice for Broken Phones - We recommend saving the money you would pay to an insurance company and instead using it to follow these steps should your phone break:
While this solution may not work for everyone, it certainly avoids the frustration of not having a phone and it'll save money over paying the insurance company each month. Of course, if you lose your phone often, then having insurance may be your better option. Good Luck!
