The popular Apple iPhone comes with one year of hardware repair coverage via its limited warranty, but what happens if the device is damaged as the result of an accident, or worse yet, stolen?
Unfortunately, Apple and sole wireless carrier AT&T don’t offer any form of “iPhone insurance,” despite the device going for a pretty penny.
However, there are other options if you want iPhone insurance coverage, though they may not make much sense for you.
1. If you have a homeowner’s insurance or renter’s insurance policy, your phone is already covered as “personal property,” under the policy provisions. For the record, so is everything else you own and may carry with you.
Here’s the catch: You likely have a deductible on your policy, and the odds are the deductible is at least $500. So, while you are “covered,” you will have to file an insurance claim and pay $500 to get your $500 phone replaced. Oh yeah, and your policy premium may go up as a result of filing the claim. Your C.L.U.E. report would show the claim for between 3 and 5 years.
Recommended: If you lose or damage the phone, don’t file a claim, just pay for it out of your pocket. If you don’t have that type of money, consider buying a cheaper phone.
2. Your iPhone may be covered as “data processing equipment,” similar to a computer, depending on the language of your homeowner’s policy. This might mean it is subject to a different, or even no deductible, if it is lost or damaged.
Here’s the catch: While this may seem like a win for you, you will likely have to argue with your insurance company, and the “loss” may still show up on your C.L.U.E. report, which may raise your insurance rate for a few years.
Recommended: The same as above. If you can’t afford the potential cost of replacement or repair of the device, you may want to consider a less costly purchase next time.
3. You may be able to purchase a personal articles floater. This is a type of marine (goods in transit) coverage that is specially designed for high cost items that do not stay in a fixed location, usually reserved for jewelry.
Good News: There is typically no deductible on this coverage type, and it is usually an “open perils” policy, which means your insurer will pay for any cause of loss unless it is specifically excluded in the policy language.
4. Your iPhone will NEVER be covered by your car insurance policy. If you leave the phone in the car and it’s stolen, you’re out of luck.
Good News: The phone would still be covered by a homeowner’s or renter’s policy if you have one.
Bad News: The loss would still be subject to a deductible, which may meet or exceed the cost of the phone.
5. Finally, there are companies out there that offer iPhone insurance for accidents and failures, but they charge quite a bit and may also be subject to a deductible.
I have heard of some companies, such as State Farm, offering coverage specifically for iPhones, for roughly $40 per year. Some policies don’t even carry a deductible.
Being an insurance professional, I am not sure how long that will last, as it leaves them susceptible to paying a lot of claims for damaged phones. It may simply be a way to get a potential insured in the door as a means to sell other, more profitable lines of insurance.
So at the end of the day, the best advice is to treat your iPhone like the tiny handheld computer it is and take very good care of it.