To insure or not to insure iPhone 4S

Last Friday, I stood in line for 1.25 hours for an iPhone 4S at a Verizon store.  The last time that I stood in line for something was for Britney Spears and then before that Bill Clinton.  As you can see, I don’t just stand in line for anything.  Hahahaha.

As the #8 customer, I was quickly whisked away to the nearest cashier station and received my white 32 GB iPhone 4S.  Then the sales associate asked me if I wanted a screen protector, case, and insurance.  My head starting hurting because there were a lot of things that I hadn’t thought about before.

I am not a big fan of extra insurance for products.  My number one reason is that I hate jumping hoops to get a claim through.  I don’t believe that an insurance really covers everything.  And insurances are a cash cow for companies.  However, I am a fan of buying insurance if the risk of losing or breaking the item is high and if it will cost close to $1K or more to replace the item.

My insurance choices were AppleCare+ and Verizon.  I didn’t look into third party insurance because I hadn’t researched them at the time of purchase.

Both AppleCare+ and Verizon need to be purchased on day 1 of getting the iPhone.  Both have deductibles although Verizon’s deductible is much higher by $100.  AppleCare+ is $99 one-time whereas Verizon is $9.99 per month with cancellation at any time.

My decision came down to coverage of when the phone is lost.  You will not get this type of coverage with many of the other insurances.  According to MicroTax, about 113 cell phones are lost or stolen every minute in the US.  I will buy insurance until the break even point of having insurance and getting a replacement Verizon iPhone.  My numbers come out to be 15 months.  After 15 months, I will cancel my insurance and take my chances.

Here are the numbers:

  • iPhone 4 (not 4S) on craigslist is $350
  • Monthly insurance price $10 times “X” months
  • $200 deductible for insurance claim for iPhone 4S 32 GB
  • Solve for “X”, 350 = 10X + 200, X = 15 months

If you decide to not sure your iPhone 4S, at least protect your glass because I think cases are useless.  When I had my iPhone 3, I dropped it face down on my driveway and bam glass all broken.  It still worked but was cracked.  I took it to some guy’s apartment to get fixed for $60.  After two to three months, 1/3 of the screen became unresponsive so then I had to borrow an old iPhone 3 from a friend.

For my new iPhone 4S, I got a Ghost Armor screen protector at a local mall.  For $35, you can get a plastic protector for the front, back, and sides of the iPhone.  They have a lifetime warranty.  If you need the front or back protector replaced, bring the iPhone back with the protector and you can get a new one installed for $5 each side.

From Verizon’s website:

Total Equipment Coverage combines the benefits of Asurion’s Wireless Phone Protection with the Verizon Wireless Extended Warranty program. If your device or covered accessories are lost, stolen, accidentally damaged, or malfunctioning due to a manufacturing defect after the manufacturer’s warranty expires, you are covered. Verizon Wireless customers can only enroll in Total Equipment Coverage within 30 days of new account activation with a new equipment purchase.

Other Devices

  • $9.99 per month per covered device
  • $169 non-refundable deductible (8GB, 16GB iPhone® 4 and 16GB iPhone® 4S) per approved claim
  • $199 non-refundable deductible (32GB iPhone® 4 and 32GB, 64GB iPhone® 4S) per approved claim
  • 2 Replacements in a 12-month period with an equipment maximum of $1500 per claim (in New York, 2 claims per policy year)

Replacement devices may be remanufactured equipment. If the same model is not available, a comparable model will be provided. You may cancel at any time and receive a prorated refund of your monthly fee.

From Apple’s website:

Every iPhone comes with one year of hardware repair coverage and 90 days of telephone technical support. AppleCare+ for iPhone extends repair coverage and technical support to two years from the original purchase date of your iPhone and adds coverage for up to two incidents of accidental damage due to handling, each subject to a $49 service fee.1 With AppleCare+ for iPhone, Apple experts can help troubleshoot issues over the phone or at an Apple Retail Store. They’ll answer questions about iOS, Apple iPhone apps such as Mail, iMessage, and Calendar, and help you solve interconnectivity issues between your iPhone and Mac or PC. And if your iPhone needs service under the plan, Apple technical support representatives can even set up a repair during the same call.

From SquareTrade’s website:

2 years of coverage: The SquareTrade iPhone warranty covers your iPhone for up to 2 years, starting on the date of purchase.

Covered Issues: Both accidents (e.g., broken screen or other damage through drops AND liquid damage including full immersion) and out-of-warranty normal use failures (e.g., battery no longer charging or other hardware failures) are covered. We do not cover loss, theft, willful damage or damage occurring through gross misuse.

Deductible: There is a $50 deductible when claiming on an accident (e.g., drops, spills). There is no deductible for a normal use failure (e.g., power issue).

How it works: You can file a claim online or on the phone. Depending on the issue, we will either fix your iPhone or arrange for a replacement. To fix your iPhone, we give you free overnight shipping to-and-from our depot and 80% of iPhones are fixed the day of receipt. If you prefer the convenience of your local Genius Bar, you can take it there and we will reimburse your repair costs.

Repair or Replacement: Based on what happened to your iPhone, we will let you know if it’s suitable for repair, otherwise we will arrange a replacement option.

Older iPhones: This coverage is restricted to iPhones purchased in the last 30 days. Older iPhones can still be covered through the SquareTrade iPhone application (available in the App Store).

Our 5-day service guarantee: We will replace OR fix and ship back your iPhone within 5 business days of receiving it at the depot. If it takes longer, let us know and we’ll be happy to refund the cost of your warranty.

Sophia Perl

Sophia Perl is a product manager for a database tool at IBM. She has over 10 years of software development and management experience. Sophia holds a BS in Computer Science from University of Southern California and an MBA from University of California at Davis. She is the creator of iPhone apps PicPredict and Eventabulous.