Complaints regarding defective equipment and lost, stolen, or damaged phones are commonplace at UCAN’s Fraud Squad. When purchasing a phone, you have two options in case something goes wrong. You can rely on the manufacturer’s warranty. Or, you can buy phone insurance from your service provider. Neither choice is ideal. The warranty is cost effective because you aren’t paying any additional fees, however, it offers little to no real coverage. The insurance gives decent coverage, but you pay a monthly fee for a service you may never need in addition to the cost of the deductible.
Most manufacturers provide 1-year limited warranties. Manufacturers do not provide very extensive coverage for damages or malfunctions. Usually, the only damages covered are those in materials or workmanship. For the most part, they won’t cover anything that happens to the phone after you start using it. That includes lost and stolen phones. Neither is covered by the manufacturer’s warranty.
In the event that the manufacturer decides your damaged phone is under warranty, they reserve the right to replace your new phone with a used, or refurbished phone. In addition, some carriers charge customers an early termination fee if they do not replace lost or stolen phones. And by the way, there aren’t a whole lot of sales or special promotions on replacement phones. Ahh, the beauty of consumer choice: pay full retail price for a new phone, or pay the cancellation fee. If you decide to stick with your manufacturer’s warranty, be sure to hold on to your receipt, as the manufacturer may require proof of purchase date.
Here are some links to manufacturer’s warranties:
| Blackberry | Motorola |
| Nokia | Samsung |
Every major cellular carrier offers some sort of phone insurance service. Most of the plans cost from $4-$6 a month, or $48-$72 a year. If you file a claim on your plan, you must pay a deductible in addition to the monthly cost. Deductibles average around $50, but can be as high as $110 depending on the type of phone. That’s a total cost of at least $100 to replace your phone in the first year of your contract. Remember, however, if you have to get a new phone without insurance, you’ll have to pay full retail price. The Cingular and Verizon online stores both offer phones that retail for $30 (and Cingular even offers a couple for under $20). But the cheapest retail price for a phone at T-Mobile’s online store is $99.99, and Sprint’s lowest priced phone retails for $149.99. Figure out the price of your phone excluding rebates and promotions. If it’s much less than $100, the phone insurance may not be worth it, especially if you can find phones at cheap retail prices. Phone insurance makes more sense for high-end cell phone owners. If the phone is lost, stolen, or damaged, it’s a lot cheaper to pay the deductible and monthly fees than to buy a new phone at full retail.
Links to carriers’ “phone protection” pages:
| Verizon | Cingular |
| Sprint/Nextel | T-Mobile |
Insurance companies will make you jump through some hoops when making a claim on a lost or stolen phone, like filing a report with the police. The type of replacement you receive is at the sole discretion of the insurer. Usually you receive a “refurbished” model that is similar to your previous phone. You get a used phone. And it may have “minor cosmetic flaws.” There is no guarantee you will receive the same model phone that you originally purchased either. Sprint even states in its Equipment Service and Repair Program Contract that, “THERE IS NO ASSURANCE, REPRESENTATION, OR WARRANTY THAT ANY REPLACEMENT EQUIPMENT WILL BE IDENTICAL OR OFFER THE SAME FUNCTIONALITIES AS THE ITEM BEING REPLACED.” So the replacement phone may not even have the same functionalities as the phone you bought with your plan. But hey, at least you’ll have a phone.
There are two phone insurance providers for all of the major wireless carriers. Lockline and Asurion. And Lockline is owned by Asurion, so really there is only one insurer for the vast majority of the wireless industry. You can find information on the major carriers’ phone insurance programs at the following sites:
| Asurion's phoneclaim.com | Lockline's Program Information |