AppleCare and other phone protection plans: who should and should not?

Apple’s standard warranty does not cover the damage, even though the phone was only months old because the fall was an accident. The screen replacement account? $ 140.

Yep, that recovery hit stabbed. But do I regret giving up AppleCare +, which would lower my business costs? Nope.

One cracked screen was enough lesson. Since that fatal incident in 2016, I have to pick up another phone for repairs. And I’m Not Alone: ​​A 2016 Verizon VZ 0.33%

a survey of more than 1,000 U.S. adults found that 49% of respondents never broke or lost their phone, and 28% did so once.

If you, like me, are the kind of person who is generally careful with your phone and covers it with a suitcase, then protection plans like AppleCare + ($ 149 for two years) and Samsung Care + ($ 216 for two years) does not make sense.

‘This is by definition a low probability event. That’s why Apple and others earn money, ”said Howard Kunreuther, co-director of the Wharton Risk Management and Decision Processes Center at the University of Pennsylvania. “People focus on the consequences and do not think about the probability.”

The biggest problem is, says prof. Kunreuther, that phone retailers know the likelihood of phone use – at least based on the phones they use for repairs – but they do not publish the data. Our consumers must calculate the risk themselves. And we’re bad at it.

When I went to research on the subject, most so-called studies were published by the companies that want to sell coverage. They often had misleading statistics or screaming omissions.

If you have a new phone during the holidays and are considering activating a coverage plan, I can see how that makes sense. The warranty included with the purchase only covers factory defects, not accidents. And the price of repairs has risen: A cracked iPhone 6 screen in 2015 cost $ 109 to repair – today the equivalent screen swap on an iPhone 12 costs $ 279 and $ 199 on a Samsung Galaxy S21. Other iPhone solutions – broken camera, faulty microphone – can cost up to $ 449.

Apple has quietly expanded coverage this fall, making the AppleCare + app look more like a deal. Customers can now claim two cases of damage each year, instead of two claims every two years. The Theft and Loss plan (an additional $ 70 on top of the basic AppleCare +) now requires a $ 149 deduction for stolen or misplaced phones, compared to $ 269.

Looking at individual numbers, it may seem like buying coverage is saving you money. Only $ 29 for an iPhone or Galaxy screen repair! But do not forget to take in that premium.

There are many numbers to think about, so let’s look at some cost scenarios. First, here’s what can be the biggest concern for someone who has just bought an expensive iPhone:

Broken iPhone 12 screen

• $ 279 – If you do not have coverage and your iPhone screen breaks.

• $ 178 – If you prepay AppleCare + for two years and break your screen.

• $ 149 – If you bought the plan and your screen does not break.

• $ 0 – If you do not have a plan and your screen does not break.

Maybe you are not prone to break, but you are worried about a stolen or lost phone. Here’s how it works with Samsungsay

newest:

Lost Samsung Galaxy S21 Phone

• $ 799 – If you do not have coverage and lose your new Galaxy.

• $ 541 – If you pay for Samsung Care + for two years and lose your phone.

• $ 312 – If you pay for Samsung Care + for two years and do not lose the phone.

• $ 0 – If you do not have coverage and do not lose your phone.

The most important consideration is probability. Are you willing to bet on Apple that you will definitely break your screen? Or is Samsung betting that your phone will definitely be misplaced? Sure, someone reading this may skip the coverage plan and later regret it, but statistically the person is in the minority.

The likelihood of damage also goes down if you slap on a high quality cough made with a smooth material and raised edges that will protect the screen. You can even add a PopSocket or ring for an even safer grip.

Plus, smartphone screens are becoming more durable. Apple says the latest iPhone 12 devices have a screen with four times the fall protection. Meanwhile, Samsung claims the S21’s Gorilla Glass Victus is the toughest glass on a Samsung smartphone.

You may not even need to consider the coverage plan. Some credit cards offer phone protection as an advantage. Chase Freedom Flex, for example, includes theft or damage insurance for phones, as long as you pay your monthly cell phone bill with your Chase card. The deductible amount is $ 50 and you can make two claims per year.

Many insurance policies for homeowners and tenants do not cover accidental damage, but it does include theft from the home under personal coverage. It covers smartphones, although the deductible is very high. My policy’s deductible amount is $ 1,000 – well above the cost of an iPhone 12. But if someone stole a backpack containing your phone, laptop, and other valuables, you’re covered. Hippo, a homeowners insurance company, and Toggle, Farmers’ rental insurance arm, let customers choose their right to deduct when choosing a policy, up to $ 500 on Hippo and $ 100 on Toggle.

When to buy a plan

The economy can be different if you can not afford to wait for repairs – Apple and Samsung are offering replacement phones as soon as the next day, and some insurance plans by mobile phone companies may even deliver the same day.

Otherwise, these extensive coverage options are best for big time chores. If you break a phone at least once a year, sign up. The question is, what plan? You can buy comprehensive coverage from your telephone manufacturer, your cell phone provider or a third party.

Most require you to sign up within a certain time after purchase, 60 days for AppleCare + and one year for Samsung Care +. Samsung theft and loss cover is only available at the time of purchase.

Some companies, such as Progressive and SquareTrade, allow you to register your phone, used or new, with a proof of purchase at any time. And no, if your phone breaks, sign up for the plan, then your existing crack is not covered. (This is insurance fraud.)

Progressive has a relatively affordable deductible for theft and loss: $ 75, with two-year premiums between $ 169 and $ 175, depending on your phone. But there is a caveat: the coverage only starts 30 days after you sign up.

SquareTrade has a flexible fee of $ 9 monthly, with a fixed amount of $ 149 deductible for all damages claims, but no coverage for theft or loss. This can be a good temporary option for travelers, for example.

Cell providers load the most. AT&Tsay

phone insurance is $ 15 a month, more than any of the ten plans I compared. However, it offers impressive benefits, including same-day replacement or repair, up to three claims per year, $ 29 screen repair, theft and loss coverage, and unlimited space in AT & T’s Photo Storage app. Even if you never use the other benefits, at least you know you can take advantage of the photo storage space.

No matter what you decide, my main advice is: Get a case to protect your investment and keep it away from salt water, even if your phone is marketed as “water resistant”.

(Dow Jones & Co., publisher of The Wall Street Journal, has a commercial agreement to deliver news via Apple services.)

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Write to Nicole Nguyen by [email protected]