I’ve always been the goto geek in my family and to my non-tech friends. The questions of what to buy, when to upgrade, how to fix this or that. Those are all easy questions to answer and I can always suggest a pretty solid reason as to why or why not. However, when it comes to insurance, it’s a challenging dilemma, as I personally have never needed it (knock on wood) for any of my devices, such as my iPhone or iPad.
So it’s not that I can give you a definitive answer here, but I’ll offer my point of view as a repair shop owner and with as little bias as possible. If you are someone who is prone to break your device more than once a year… then yes, insurance is probably worth investing in. If you are more like me, and have yet to break one, even though a few drops… then it would seem insurance is a waste of money.
So until this is a reality…
The real judgment here is understanding the true cost of the device you’re insuring and the true cost of the insurance. While you may think your iPhone 6 is worth $199 because that is what you paid, you’re in for a nasty wake up call when you try to buy a new one outright. The base 16 gig model will run you nearly $600. The repair for an iPhone 6 is currently $159 here at Mission Repair. You might pay $7-$10 per month for insurance and have a $50 deductible which is roughly $84 to $120 in premiums over the course of a year. Plus, $50 each time you break your phone. The worst part is the fact that you may never use the insurance, and over the years, forget you’ve been paying that monthly premium, especially if it’s autimatically paid on a credit card. Let’s just say that adds up to a lot of money over time… and you would still be required to pay a $50 deductible upon repair.
The bottom line is, insurance companies don’t build new office buildings because everyone is using the insurance. They make their money on the premiums that people are paying in over time and consumers not using the policy. Sort of like casinos, they don’t build billion dollar resorts because the customer is winning more than the house! I would suggest buying a piggy bank, put in $10 per month and if the screen on your phone shatters… well time to crack open the piggy bank and come see us at Mission Repair!
Lastly, take a look at the fine print on your policy to see what is really covered and what is not. Water damage? Dropping your phone? Most likely neither of those are covered with a traditional cellular provider (AT&T, Verizon, Tmobile) insurance plan. That’s “extra” or you need to find a specialty insurance carrier that covers those specific types of damage.
I know that last part is a bit bias… buy hey, I need to earn my $10 to put in my piggy bank!
Have a great day!