Do You Really Need Cell Phone Insurance?

Samsung cell phone

Cell phone insurance is a waste of money right, who needs it? Just two months ago I was so excited to have my new cell phone, a Samsung Galaxy SIII, it was an awesome  phone. First thing I did when I got home was logged into Amazon and looked for a hard case to protect the phone. I was trying to save money out-of-pocket by using my gift-cards from Swagbucks.

You with think with modern cell phone technology that they would figure something out so cell phones were protected from the average clumsy person dropping them. Even worse a child getting their hands on a cell to play pass the puck or toast the cell phone for breakfast.

I guess I’m just dreaming of the indestructible cell phone but we all know that will never happen, nothing seems to last like the good old days. It’s more about short life span and getting the customer to fork out more cash because they get so used to having technology at their fingertips.

That just seems too easy though because accessories make up another chunk of profits for these organizations as if the ridiculous high costs of cell phones weren’t already a lucrative enough business for them.

Well there was my second mistake (first mistake is coming up), a hard case sounds great right? I’m not sure what I was thinking as I should have bought a rubber one that might absorb some shock if dropped. You can probably figure out where I’m going with this….

Bye Bye Cell Phone

I pulled my cell phone out of my pocket to take a picture at work then put it in my coat pocket so I could continue working. I turned around and my phone flew out of my pocket right onto the nice solid floor in Wal-Mart. Nothing like a new dropped cell phone smashed to bits staring right back at you.

The second I looked down I wanted to cry. I broke my screen on my phone, oh great, sigh. I started to think out loud as I was still in a state of shock,“I broke my cell phone, now what do I do”? It’s that moment where everything just comes to a screeching hault in your life. I know it sounds off the hook but my cell phone carries more weight than just a phone for work and pleasure for me.

At least with a dropped cell in water I would have had a bit of hope of some sort of recovery, but I had blown this one out of the water.

My practically brand new cell phone was laying on the floor with every colour of the rainbow across the screen. I don’t even have a picture to show you because my phone was my camera! Now I can’t even see colour, it’s just a solid black screen with no life to it at all.

So now what?

Importance Of My Cell Phone

I had just switched  from Telus and obtained this cell phone by negotiating a 3 year contract with Rogers Wireless.  I am very uncomfortable being outside of my home without my cell phone. The reason behind this is not that I have some sort of unusual connection to my cell phone, far from the justification.

The reason is that I have a 4 yr old child with an illness who is just finishing his first year of school and has suffered from a seizure disorder since the age of 6 months.

With my job I work on the road and travel to multiple stores around Ontario which I really do enjoy. When I have my cell phone on me I can relax knowing that I can be reached at any given time in case I’m needed. I was working across the road from where I bought the cell phone and where the dropping incident occurred so I went over to see if they could help me out all.

The Bad News

As you can see from the picture above that my cell phone looks fine, the glass didn’t break, which would have been about $100 to fix my phone but that was not my only problem. I was told that the LCD under the glass was completely destroyed and that I was looking at $400 to have it repaired. Boy, did that make me feel better, not.

I nearly had a heart attack, the value of the cell phone is $600. After some in-store credits and the contract I had managed to walk out the first time without spending a dime on my phone.

The phone cost $149.00 on a three-year contract but the in-store credits, some of which ended half hour after I walked through the door, covered that entire $149.00. That left me responsible for $450.00 over the course of three years.

My first mistake….a big mistake

Insurance, What Insurance?

The associate then asked me if I had purchased cell phone insurance? Insurance? What cell phone insurance? She looked at my account and  of course no insurance is anywhere to be found. I do not remember being offered cell phone insurance, although she insisted that they offer it to every customer.

It’s possible I said no but I’m a little clumsy at times and I know this, I can’t imagine I would have said no! The $7.99 a month insurance would have replaced my phone, even if it was physical damage, with a $50.00 deductible. Sounds great now!! Lot of good that will do me.

I didn’t know what to do at this point as I really needed a cell phone at all times. I could put down a $50.00 deposit for a loaner phone and send my phone away for repair or walk out and have to buy a brand new cell phone. I explained why I needed a phone and that I did not have $50.00 at the time.

She suggested that I take some time to think about it and offered me a loaner phone for free for a week, on my word that I would return it.  I was very grateful for her being willing to help me out and that is what great customer service is all about.

That long week

Feeling Out Of Touch

Being a single working mom of two kids one of which has seizures my phone was not only a necessity but it became a very big convenience in my life. I get a lot of email communication for my job and I do not get too many opportunities throughout the day to get on my computer. My social media appearance and email activity had diminished in that long week and I even worried Mr. CBB because I wasn’t around!!

I felt very out of touch with the world, and unable to efficiently organize my work week without my cell phone. The importance of cell phones in our lives seemed so apparent to me at this time. I was missing emails that required a quick response and just fell behind as some days I can get 8-10 work related emails.

I had to make a decision and fast even if it meant breaking my budget and going into my emergency savings account; after all that is what I saved the money for, an emergency.

The Loaner Phone

So now I have a very basic phone that does not allow me to get access to my email, a very slow online browser and I think the original version of mobile Facebook! I certainly lost the convenience of my smartphone that week but I was thankful to be able to make and receive calls.

I called around to a few local repair shops to see if I could find a better deal to have my cell phone fixed. No luck there. There was no way that I could put $400 back into fixing that cell phone. I just could not afford that. I had to decide if I was going to look on Kijiji or Ebay to try and find a cheaper cell phone or pay full price for a brand new cell phone.

My New Cell Phone

I eventually decided to pay full price for a brand new cell phone.

Why did I decide to buy another brand new cell phone?

First of all, I am tired of spending money on cell phones! I opted a few years ago not to have a home phone as I was paying for something that I rarely used, so I rely solely on my cell phone.

Now that I know about the $7.99 monthly insurance fee that would replace my phone for a $50 deductible, I wanted to be able to have that  peace of mind option, this time….. instead of getting stuck in this situation again.  If I were to buy a used phone from Kijiji or Ebay there is no option for the insurance or warranty coverage.

Should I Buy Cell Phone Insurance?

For some people cell phone insurance may seem like a waste of money but for someone who is as clumsy as me and who really needs her cell it’s worth every penny. You might also want to check with your homeowners or auto insurance to see if your policy covers theft, loss or damage to your cell phone before committing to cell phone insurance.

Do your homework, make sure you are protected, if it’s worth it to you. If not, well then I guess you might have to suck up the costs like I have to.

I am now stuck with $450.00 of the cost of this broken, useless phone over the course of my 3 year contract and just spent over $200 on a new cell phone! A lot more than I would have had to pay if had just had that darn cell phone insurance!If this ever happens again, when someone asks me if I have the cell phone insurance I will very proudly say ‘You bet I do!’.

Do you have cell phone insurance? Why or Why not? Have you ever been in the same position I’m in?

Post Contribution By: Katrina is regular contributor for Canadian Budget Binder and is as passionate about personal finance as she is gardening. Katrina is a horticulture graduate with over 10 years experience with landscaping and greenhouse production. Her goal is to share her knowledge and experiences blogging about gardening and her continued passion for personal finance in hopes of motivating others. While being a single mom of two and working in a sales and marketing position, Katrina runs her own Landscaping Services in Southwestern Ontario.

 Quote-Budget and Money

 Have you ever broke your phone while in a contract and not had insurance?

  • Are you NEW to Canadian Budget Binder?
  • Follow Mr.CBB on TwitterFacebook and Pinterest
  • Do You Have A Question For Mr. CBB? The best way to get in touch with me is on Facebook
Mr. CBB
Mr. CBB was born and raised in the United Kingdom who then moved to Canada where he is a permanent resident. He recently became a father to a very busy toddler who allows him to be a kid at heart. He bought his first house at the age of 21 after University and his second at the age of 24. Both Mr.CBB and his wife are Debt and Mortgage Free and they did it all in under 5 years using a Budget. Canadian Budget Binder is a place where he shares their financial experiences with his readers and hopes to learn about theirs. Welcome to CBB!
Mr. CBB
Mr. CBB

Comments

  1. I don’t on my cellphone as mine is pretty basic and pay-as-you-go since I don’t really make calls on it, used mostly for texting (stay in touch with my son) and sometimes accessing email/Facebook. But when my son got an iPhone 5, knowing how he is with phones, I decided he should have the insurance, and we’ll see as time goes on if we need to keep it for the entire length of the contract or not (I pay 1/3 of the monthly cost for his phone, he pays the rest).

  2. Wow, sorry to hear about your experience. We bought insurance on my wife’s iPhone 5, because it is our business phone and what we depend on. The problem though is they charge $10.99/month and the deductible is $200. At least we can write some of that off with it being for our business. When we upgrade mine next month I’ll be passing as it’s just too much money. I’ll be keeping my old one in the case something like this happens & can just reactivate it.

    • Katrina B says:

      John did they give you an explanation as to why the insurance price and deductible is so much more for the iphone?

  3. I know I have a iphone and my phone is cracked but still able to use when I renew my contract next year I will definately be getting the insurance! Hubby bought it for my birthday but didn’t think it was worth getting insurance he wished he had now!

    • Katrina B says:

      Well at least it can still serve it’s purpose for you. I didn’t mention but I should have that the iphone insurance is $9.99-$10.99 a month with a $200 deductible, I’m not quite sure why that is..I’ve never owned an iphone

  4. Although, I choose not to have insurance coverage I can see where considering insurance for some people would be benificial. Thanks for sharing your experience It will give me something to consider if my situation should change!

  5. i never throw away my old phones in case something like this happens.
    I always back up my smartphone on weekly basis by using an app and cloud service.
    $7.50/month is way too much for insurance…- you are paying $90/year…you can buy some used smart phones on Kijiji for about $200 – nothing fancy though.

    • Katrina B says:

      It does seem like a lot but as my contract lapses I will look into what my contract buyout price is, if it is less than what I would pay to continue my insurance I will cut the insurance off. I need the piece of mind that I could replace my phone if needed….again….

  6. Have you looked into the coverage credit cards offer? Does a cell phone qualify for the credit card coverage? I know discover card adds an additional year of warranty to electronics. I’m not sure how much that covers, but it would be useful for me to investigate.

    • That happened when we bought our Smart TV… if we paid by credit card they would cover the first year of a warranty but if the product came with a 2 year warranty that didn’t make a bleedin difference. That’s a good point though that you make as many people might not be aware of that. Cheers

    • Katrina B says:

      would that not only apply if the purchase was made with that credit card? Looks like I have some investigating to do….

  7. I used to have cell phone insurance, but then I took it off because I never used it. They were getting $7 a month from me for about 5 years. I decided to take it off but I am pretty careful with my phone. I also have an emergency fund that can handle a new phone. Most insurance companies don’t give you a new phone, they give you a refurbished phone, so make sure to check the insurance contract.

    • Katrina B says:

      It certainly isn’t for everyone, I figure it’s a good investment for me as I tend to drop it no matter how careful I try to be. Rogers made it sound like they would have given me a new phone, I will have to look more into this. I am good with paying the insurance right now, since it can be removed any time from my bill I may remove it once I have had the phone for a good portion of my contract as the buy out price on my contract may be less than what I would be paying for the insurance.

  8. Here’s one for you. I will always remember the day I bought my first cell phone, in 2004. Why will I remember it, because an hour later I set it down on a counter while working to assemble something, and knocked it off and into the dog’s water bowl.

  9. Earlier this year I smashed the screen on my phone. I didn’t have insurance and no warranty, even though that probably wouldn’t have mattered. I looked up a video on how to repair the screen and was surprised that I was actually able to fix it. The parts cost me about $50 or so but I didn’t have to buy a new phone or enter into a new contract. I was pleasantly surprised.

    • Katrina B says:

      You were lucky! The part to fix my phone was the same price as what I paid for the new one,and the labour brought the price up to $400.

  10. I have mobile phone insurance as an extra feature on my bank account. I don’t know if it covers everything it should though and after hearing your story I’m certainly going to find out. Thanks for sharing Katrina.

  11. My first cell phone was drowned in lake water! Luckily it was a really cheap one.

  12. Christine Weadick says:

    Our daughter has a used blackberry that was given to her by a friend at work. The boss uses one too so it made sense for her to have one. I think the contract runs out in the next month or so, not sure… But I will make sure she looks into this stuff. The only reason she even has a land line right now is that she is in a controlled entry apt building and needs the land line to buzz friends in. Our younger son has a very basic pay as you go cell phone that we take with us for appointments out of town. He got that a few years ago as aback up when we had issues with the land line here. Thanks for another great article Katrina!!!!!!

  13. I’ve never had any phone insurance before but in the past I didn’t have a smart phone either I just had a regular old cell phone and if I happened to ruin it I could usually just pull the cell chip out of it and put it in any phone I have. Now that I have a smart phone it’s a bit different. When it comes down to it I’m just going to keep my old phone when I switch to a new one that way I have something to go back on. As far as the insurance goes it probably wouldn’t hurt to get it since my company pays for it anyways.

  14. Christine I know many people who can use their cell phones for buzzing people into their buildings, she should look into that too 🙂

  15. I guess I’ve never had a phone worth insuring, but if I ever had an expensive phone I would certainly consider it. We also don’t have a home phone, so I’d be in trouble without one.

  16. Instead of insurance, I bought a Lifeproof case. It’s water, shock, dust, mud, proof.

  17. I’ve always had cell phone insurance with my previous phones. I have had a cell phone for over 12 years and this is the first year that I have decided not to carry cell phone insurance. I have a smartphone, but I’ve downgraded from my iPhone, so I figure if ever I need a new phone I can purchase one. Besides, I have probably used my insurance twice in all 12 years.

  18. mycanuckbuck says:

    I didn’t even know it existed! I don’t use mine enough or have a good enough one to bother.

  19. theoutliermodel says:

    I don’t have cell phone insurance. I do like to buy my phone outright, but generally, I’m pretty good with taking care of my stuff, so it lasts.

  20. My husband’s phone broke while we were on vacation. We didn’t have insurance so we had to pay $200+ for a brand new “dumb” phone. We both added insurance to our plan after that.

  21. I can’t believe this is your subject today, because I lost my cell phone on Saturday. Did I have cell phone insurance? No, but I wish that I did. My phone was an Iphone 4 and I got it 2 years ago when my phone company, Sprint, first started to carry iphones. When I got the phone they didn’t offer insurance on it. I probably could have gone to Apple at that point and gotten their insurance- Applecare- but I don’t really know if that covers losing your phone. In looking at my phone bill yesterday I see my daughter has insurance on her iphone so Sprint must now have such insurance.
    Although I’m saying I lost my phone, ultimately it was really stolen. I was in the dressing room in Kohls when my husband called me. I put the phone on the shelf with the speaker on to continue getting changed. When I left the dressing room I also left the phone. The store was crowded with 2 people waiting for a dressing room. The nice looking lady with a young child was who went into my stall and I would guess grabbed my phone. Within 10 minutes I went back looking for the phone but it was gone. Their was a dressing room attendant right there and no one turned it in to her.
    Within half an hour I was at home gpsing my phone which was turned off. It had a full charge so the culprit with my phone turned it off. I had the apple app Find My Phone on it so I set a lock on my phone, and set it to make a loud sound when powered up. Also it will display a message saying I am lost call _________ and a tracing mechanism will begin. Problem is as far as I can tell the phone has not been powered up- or the tracing doesn’t work.
    So, now what? A new comparable phone costs a few hundred dollars. I have an upgrade available from Sprint on July 1 with a new 2 year contract and I can get a new phone for free. So I’m looking today to buy a charger for an old phone and will use that until July 1.
    I use my phone for many things so I’ll miss it for the next 2 weeks. I had to dig out my old digital camera to use for my grandson’s graduation this week. When we drove to the beach yesterday I missed my license plate game app. I never put my calories in my calorie counting app the last 2 days so I’ll have to start doing that online. Luckily I have my phone backed up on iCloud so I can restore everthing on my new phone. Just waiting now for July 1.

    • Hi Karen,
      Wow, what a story and it’s a shame that people can be so greedy as to not return it. Of course they knew you were going to come back the moment you knew it was missing. It was also in a spot not just found random on the grass. I can’t stand people like that. What advice would you give to others now that you’ve been through this experience?

      • I would make sure to have insurance as long as the fee for it is reasonable compared to the deductible. If you have a smart phone put some apps on it to lock, erase and track your phone. Even if you never get it back you can stop someone else from profiting from your loss. Make sure you back up your phone too. I would really be upset if I knew I had to re-do everything on my phone.

        • Those are some good points you bring up and that anyone who reads this post would certainly benefit from, so thanks. I don’t own a cell phone so I’m learning along the way and it’s great to get feedback from those that experience situations such as you have. Thanks for sharing your input Karen! Mr.CBB

Add Your Comment

*