If you're planning to buy a new iPhone or if you've just gotten one, you may be debating whether to buy insurance. An iPhone is an expensive investment and many people store a lot of valuable information on theirs. If it breaks or you lose it, you could lose a lot of time and money. But if you buy insurance and never use it, that can be a loss of money as well. If you're trying to decide whether insurance is right for your situation, carefully consider the pros and cons.
Warranty vs. Insurance
Purchasing an extended warranty on your iPhone won't offer the same level of protection as insurance will. Apple Care is an extended warranty program offered by Apple. All iPhones come with one year of technical support and repair, but Apple Care extends that to two years for $99 as of the date of publication. The warranty also covers two incidents of accidental damage, but you'll have to pay an additional $49 when you make each of those claims. In contrast, insurance coverage typically covers all of that plus theft or loss.
Some insurance plans are offered by carriers that sell iPhones such as AT&T and Verizon; others are offered by third-party companies such as Protect Your Bubble. Before picking a plan, make sure you know what is covered. The plans generally cover mechanical problems and malfunctions, accidental damage such as if you drop your iPhone and crack the screen, and theft or loss of your iPhone. Some insurance plans also offer additional coverage that includes locator services if your phone is lost, credit monitoring and even a lock and wipe service that wipes all the data from your phone remotely if it's stolen. Sometimes the plans that offer these services will be priced higher, but the exact amount varies from plan to plan. For example, Verizon partners with the third-party company Asurion to provide insurance that includes mobile tracking and wiping for stolen phones. This total coverage costs $1.81 more per month than its basic insurance plan, as of the date of publication.
Many iPhone insurance plans come with a deductible that is higher for iPhones than other smartphones, plus a monthly charge. You'll have to pay the deductible when you make a claim, but any cost above and beyond the deductible will be covered by the insurance. For example, as of late 2012 AT&T offered insurance for $6.99 a month, Verizon for $9.99 a month, and Protect Your Bubble for $7.99 a month. AT&T's deductible was $199, Protect Your Bubble's is $120, and Verizon's ranged from $169 to $199, depending on the type of iPhone. This means that two years on Verizon's insurance plan plus the deductible would cost $410, while replacing the phone at full price could cost as much as $849. If you're likely to drop or lose your phone, this can be a bargain.
Risk or Security
The bottom line when deciding whether to buy insurance for your iPhone is whether you're more comfortable paying extra money every month so you can have additional security, or if you'd rather take the risk and save the money. Some people would rather forgo the monthly payments and put that money aside for a new phone. Others can afford a small monthly payment, but they wouldn't be able to afford to spend $500 to $800 all at once on a new iPhone. Look at what's most important to you and decide accordingly.
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