Should You Get Cell Phone Insurance?

If you (or your teenager) often drop or misplace your cell phone, it may be worth it to buy coverage along with the phone.

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Question: Now that new cell phones are more expensive, should I consider getting cell phone insurance? What are the best options? –M.S., San Diego

Answer: Cell phone insurance isn't worth the cost if you rarely lose or break your phone. Plus, the manufacturer's warranty usually covers malfunctions in the first year. Logan Abbott, president of Wirefly.com, a website that analyzes phone plans, says you're better off buying a sturdy case, such as an OtterBox ($18 to $40).

But if you tend to be hard on your phone (or have a teenager who is), you may want some extra coverage. You have several options, with different prices, deductibles and exclusions.

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For iPhones, AppleCare+ provides the best coverage. For $149 for most iPhones (or $199 for the iPhone X), it provides two years of tech support and hardware repair. It also covers two incidents of accidental damage, with a $29 "service fee" for a cracked screen and a $99 charge for other damage. If Apple decides to replace rather than repair your phone, you may get a replacement the next day.

AppleCare doesn't cover lost or stolen phones, but the insurance sold by most wireless providers does. Sprint charges $13 per month for Total Equipment Protection Plus, which now includes tech support from AppleCare. Sprint's plan charges a $29 fee for cracked screens and a $99 replacement fee for most broken iPhones. Sprint-authorized technicians repair non-iPhones, though with higher repair and replacement fees. The plan also covers lost or stolen phones (after a deductible). Verizon charges $13 a month for similar coverage, with an $89 fee to replace most broken phones.

Best Buy's Geek Squad covers non-iPhones for $7.99 per month for repairs or $10.99 to add theft and loss coverage. You'd pay about $60 to fix a cracked screen at a repair facility (available for Samsung phones in 11 states). Otherwise, you ship your phone to be repaired or replaced, and the replacement fee runs $149 to $199.

Kimberly Lankford
Kimberly Lankford
Contributing Editor, Kiplinger's Personal Finance

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.

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