Should you insure your mobile phone?
If your phone costs more than your desktop, you’ve probably wondered if you should protect it against theft, loss or accident. But are mobile phone insurance policies worth having?
In early 2013, the Delhi Police published a report stating that only 2% of stolen phones are ever recovered. That’s about 2% more than we expected. Quite possibly, you’ve had a phone stolen, or at least left it in a cab or on the train. If that was five years ago, the loss was more frustrating than costly. But now we’ve got smartphones that we’re still paying the card company for. So now, is the insurance worth it? Here’s what’s on offer.
Who offers it?
It’s not a popular product – not yet, at least. Currently, only a couple of public sector insurers (which also insure cycles) offer this product, aside from manufacturers or retail stores. We’ve looked at the policies offered by New India Assurance, Oriental Insurance, The Mobile Store and Nokia (also via New India Assurance) for this report.
For how long?
You can only insure your phone for the first year. It could still be worth much on the secondary market, but insurer’s don’t generally insure phones over 12 months old. And in case of a claim in the opening year, here’s how depreciation is generally calculated:
|0 to 90 days||0%|
|91 to 180 days||25%|
|181 to 365 days||50%|
Mainly, phone insurance covers theft. In this case, depreciation does not matter. You would be given a replacement. However, your phone would also be insured against damaged in any accident or fire. In such cases, depreciation would be taken into account.
What’s not covered?
If your mobile phone is stolen from an unattended vehicle or from a vehicle which wasn’t securely locked, you can’t expect a replacement. Also, if your phone was misplaced, stolen or damaged when in possession of someone else, the insurance would be void. Other standard manufacturer warranty terms like defects, mechanical or electronic breakdown and damage by wear and tear are not covered. Mysterious disappearances, where you cannot explain how your phone was lost, are also not covered by this policy.
It isn’t expensive. Nokia, for example, which has a tie-up with New India Assurance, will charge 1.25% of the total cost of your phone, subject to a minimum of Rs50. That’s Rs200 on a Rs20,000 phone. But Nokia offers cheap rates even for expensive phones. Insurers, however, charge a proportionately higher premium for costlier smartphones. The Mobile Store, for example, charges up to Rs1,125 for phones that cost over Rs35,000 (effectively Rs94 per month).
Is phone insurance worth it?
For covering damage, an insurance policy is far from worth it because the standard warranty covers it all. For cover against theft, though, phone insurance is recommended. Given that you need to make that careless mistake just once in a whole year for it to be stolen, it may be worth spending the money on insurance.