BFSI GUIDE
Insurance for Your Mobile Phone
Why you may—or may not—want it
A lot can happen with your precious mobile phone and we all know that all too well. It can, for instance, just slip off your hand and land on hard concrete, it can fall into the toilet, it can accidentally get left behind at a random place, for you to never see it again. The point is, should you opt for insurance cover for the phone to deal with a situation where it is damaged, lost or stolen? An insurance policy can help you cover the cost of repairing or replacing your handset. So then, if you decide to get a policy and are looking for one that works best for you, start by thinking about what you need from your insurance.
The insurance may cover a wide range of aspects including:
• Theft/Loss
• Damage arising from fire, lightning or explosion
• Damage to phone screen
• Unauthorized usage
• Accidental exposure to any fluid leading to
damages in internal circuitry
A critical aspect of your mobile-phone insurance is the type of theft it covers. For instance, theft without force or unattended theft may not be covered. If someone takes it from a table in a cafe when you’re distracted, you may be left uninsured.
How can you get this insurance?
• Go to a mobile-phone showroom (the seller is always different than a manufacturer under the franchise model of marketing).
• Select the model that you want to buy after going through the product specifications. In India, mobile-phone insurance is not available from either manufacturers of mobile phones or general insurance companies. Some of the insurance companies cover this indirectly as a personal liability under household package policy. Mobile-phone distributors/wholesale agents offer insurance for the costlier phones – this, though, comes with a warranty rather than as an insurance cover. • Settle on a mutually agreed price (which should also include mobile insurance/warranty premium, at least for the first year from the date of payment).
• Most mobile-phone sellers come with a warranty rather than an insurance cover, which is offered for a particular number of years on payment basis. In order to claim insurance, one must intimate the insurer about loss/theft or damage of the phone at the earliest. One needs to submit the original purchase invoice and the serial number of the phone along with the claim form. In case of theft, the claimant will have to provide a document stating that SIM card has been blocked and a first information report (FIR) stating that the phone has been stolen.
Advantages of Mobile-Phone Insurance
• It comes at a cost but may turn out to be costeffective should an untoward incident happen.
• It gives you peace of mind. Theft and accidents happen unannounced and insurance provides a degree of assurance, protection and compensation in such situations.
• If you purchased your high-end phone through financing, you will end up paying EMIs for a phone that you no longer possess. Insurance will be handy in such a situation.
• Accidental-damage cover can be a boon for many. Some mobile-phone policies pay out if you drop or break your phone, and they also cover things like water damage and cracked screens. The repair cost of display is quite high.
• Without insurance you may not be able to get a replacement phone of your choice immediately.
• Rider options or additional benefits like transit insurance and worldwide coverage can increase the value of the insurance.
The Limitations
• You may never use the insurance.
• Not all mobile phones come qualify for insurance; its coverage is limited to high-end phones.
• Your insurer may not pay out if you have been careless
or left your phone behind—in a taxi, for example. If you are seen to have been careless by the provider, you might not be covered by the insurance.
Think about what you need to insure against and find a policy that offers this cover. You may only need basic damage cover, or you may want more comprehensive cover that offers better protection. In any case, make sure that the policy you choose has all the cover you need. Check if it provides instant cover and whether there’s a limit on the number of claims per year.