Is It Worth Insuring Your Cell Phone?

by Vinaya HS on August 19, 2010

in Finance

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These days, most cell phone stores try and push an “insurance cover” — an extra cost — for your cell phone. At some stores, the “insurance premium” is built into the price — they don’t give you the option to opt out. But, is it necessary, in the first place, to insure your cell phone? Isn’t the warranty good enough? Or is this just one more means for the store to make money off you?

What do you think?




Thanks for reading this article. I'd love to hear your opinion. Please use the comments section below to share your thoughts. I frequently write new articles that also cover several other aspects of personal finance including credit cards, financial goals, health insurance, income tax, life insurance, mutual funds, retirement planning, and much more. You can Subscribe through Email and receive new articles directly in your Inbox or you can Subscribe through the RSS Feed and receive new articles in your feed reader.

{ 4 comments… read them below or add one }

Digamber August 19, 2010 at 9:30 AM

I agree with you, Insurance is require for handset which doesnt have tracking system, atleast we get back.
I have lost my handset while travelling, and couldnot get my handset even after registering FIR in Mumbai.

Shilpa August 19, 2010 at 9:31 AM

I think it is unnecessary unless you are going for a high-end phone costing many thousand rupees. The depreciation rate of a mobile is very high. The value of the phone after the warranty period is close to zilch.
Also, does the insurance cover theft? Even if it does, many police stations refuse to take a complaint of mobile theft.

Vinaya H S August 19, 2010 at 10:13 AM

@Shilpa: Good point. I think the available insurance cover decreases in direct proportion to the depreciation. The insurance cover is highest during the first month or so, then it drops a certain percentage as your phone ages — meaning you’ll need to pay-up the difference from your pocket. What then is the point of insurance?

Anoop August 19, 2010 at 10:59 AM

All electronic items value depreciates over a period of time, its not a valuable suggestion to take insurance cover for Electronic goods such as cell phones, its only one way of milking money out of your pocket for something that you as a user will never have a resale value, people who are honest enough will end up spending a lot of money if they avail this insurance, others may well use this policy to benefit them, example : someone can hide the mobile phone and report it as stolen or damaged and claim insurance.
I dont believe because I’ve been using the same cell phone for more than 5 years now, neither did I lose one in my life nor did I get it damaged.

I believe its another policy which lies in your wtf mate category.. What do you think?

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