Cell Phone Insurance - Look Before You Buy

Our cell phones are a life line, a work tool, and in some cases, the tie that binds families. To be without a cell phone is unimaginable for many but it is a reality that they are faced with at some time as record numbers of handsets are lost, stolen, or rendered useless each year. However, in a nation that attempts to insure every possession, cell phone insurance is available.

Numerous insurers have popped up in recent years promising to end the turmoil caused by the unexpected absence of these handy devices. These companies reassure us that we won't go more than a matter of hours when a cell phone is stolen as they strive to quickly resolve claims and replace our valuable goods. But is this insurance really cost effective? Does it provide the service that consumers anticipate? Potential buyers need to take the time to seek out the details of a policy before deciding that such insurance is a solution to the issue of a cell phone gone missing or bad.

When reviewing a cell phone insurance policy, buyers should consider a few things:

Consider the cost of the coverage.

This includes the monthly payments times the number of months the owner anticipates having the phone. For instance, a $5/month policy held on a phone that is owned for 3 years would total $180. That is $5 x 36 months = $180. Now the potential buyer must also factor in any deductible. For our example lets say there is a $50 deductible. The new total of $230 represents what the buyer would actually be paying if indeed their phone had to be replaced. Consumers need to compare the cost of a new, equivalent cell phone compared to the cost of the coverage. If they can obtain a new phone on their own for nearly the same amount as the cost of the policy, they are better off forgoing the insurance.

How are cell phones replaced?

Is there a guarantee that the phone will be replaced with a model of equivalent or better value? A guarantee that the phone will be new rather than refurbished? Is there language assuring the time frame in which the phone will be replaced? These types of questions will help determine whether or not the service will meet the needs for immediacy in obtaining a replacement and if the replacement will be inferior or equivalent to the original equipment.

What does the cell phone insurance policy cover?

Does the policy apply to cell phone theft, cell phone loss, and significant damage? It is important to know which situations are covered and which are most likely to occur. If the policy does not cover the situations that a particular buyer is most concerned with, then the policy is useless to them. Many policies will differentiate between loss and theft; sometimes requiring a police report for thefts.

Know what the cellular provider can do in these instances

Some cellular providers are willing to help replace a damaged or missing cell phone that a user has had for more than a year. In some cases, a replacement will be provided or discounted, minimizing the need for the additional protection of cell phone insurance.

Like any type of insurance coverage, cell phone insurance could provide significant assistance in quickly replacing a vital device that an owner can not afford to replace in some circumstances. However, in many instances it is merely an added expense. Consumers need to carefully review the policy to determine whether or not it offers the type of protection they need for their cell phone.