AppleCare and other phone protection plans: who should buy them and not buy them

Apple’s standard warranty did not cover damage, although the phone was only a few months old, as the fall was an accident. The bill for screen replacement? $ 140

Yes, that repair shot stung. But am I sorry to set aside AppleCare +, which would have lowered the cost of my pocket? No.

A cracked screen was enough lesson. Since that fateful 2016 incident, I still haven’t picked up another phone to repair it. And I’m not alone: ​​a 2016 Verizon VZ 0.33%

a survey of more than 1,000 American adults found that 49% of respondents had never broken or lost their phone, and 28% had done so once.

If, like me, you’re the type of person who usually cares about your phone and covers it with a case, phone protection plans like AppleCare + ($ 149 for two years) and Samsung Care + ($ 216 for two years) do not make sense.

“These are low probability events by definition. That’s why Apple and others make money, “said Howard Kunreuther, co-director of the Wharton Risk Management and Process Processes Center at the University of Pennsylvania.” People focus on the consequences and don’t think about the probability. “

The main problem, says Professor Kunreuther, is that phone retailers know the likelihood of damage to phones — at least based on the phones they carry to repair them — but they don’t post that data. Consumers are left to calculate the risk ourselves. And we are bad at it.

When I went to seek research on the subject, most of the so-called studies were published by companies with the intention of selling coverage. They often presented misleading statistics or obvious omissions.

If you have a new phone during the holidays and are thinking about activating a coverage plan, I can see how it seems to make sense. The warranty included with the purchase only covers manufacturing defects, not accidents. And the price of repairs has risen: a cracked iPhone 6 screen in 2015 cost $ 109 to fix; today, the equivalent screen exchange on an iPhone 12 costs $ 279 and $ 199 on a Samsung Galaxy S21. Other iPhone solutions (broken camera, malfunctioning microphone) can cost up to $ 449.

Apple quietly expanded coverage in the fall, making the AppleCare + program more like a deal. Customers can now claim two damages cases each year, instead of two claims every two years. The theft and loss plan (an additional $ 70 additional to AppleCare + Basic) now charges a $ 149 deductible for stolen or out-of-place phones, starting at $ 269.

When you look at individual numbers, it may seem like buying coverage saves you money. Only $ 29 for an iPhone or Galaxy screen repair. But don’t forget to consider this premium.

There are a lot of numbers to think about, so let’s look at a couple of cost scenarios. First, here’s what may worry most about someone who just bought a high-end iPhone:

Broken iPhone 12 screen

• $ 279: If you don’t have coverage and it breaks the iPhone screen.

• $ 178: If you pay in advance for two years AppleCare + and your screen breaks.

• $ 149: If you purchased the plan and your screen doesn’t break.

• $ 0: If you don’t have a plan and your screen doesn’t break.

You may not be prone to breakage, but you are worried about a stolen or lost phone. This is explained below with Samsung‘s

last:

Samsung Galaxy S21 phone lost

• $ 799: If you don’t have coverage and you lose your new Galaxy.

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

• $ 312: If you pay two years of Samsung Care + and don’t lose your phone.

• $ 0: If you don’t have coverage and don’t lose your phone.

The most important consideration is probability. Are you willing to bet on Apple that will definitely break your screen? Or are you betting on Samsung that your phone will definitely be out of place? Sure, someone who reads it may skip the coverage plan and regret it later, but statistically that person is a minority.

In addition, the likelihood of damage decreases if you hit a high-quality case made of a non-slip material and raised edges that will protect the screen. You can even add a PopSocket or a ring for even more secure grip.

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

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

Many homeowners and tenants insurance policies do not cover accidental damage, but include theft of the home under personal property coverage. This covers smartphones, although deductibles are usually high. My policy deductible is $ 1,000, well above the cost of an iPhone 12. But if someone stole a backpack that included the phone, laptop, and other valuables, it would be covered. Hippo, a homeowner’s insurance startup, and Toggle, Farmers’ tenant insurance arm, allow customers to select their deductible when choosing a policy, as low as $ 500. Hippo and $ 100 at Toggle.

When you should buy a plan

The economy may be different if you can’t afford to wait for repairs: Apple and Samsung offer replacement phones as early as the next day, and some insurance plans through cell phone carriers can be delivered up to and all the same day.

Otherwise, these extended coverage options are best for people who need a great time. If you break a phone at least once a year, you’re sure to sign up. The question is, what plan? You can buy extended coverage from your phone manufacturer, your mobile operator, or a third party.

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

Some companies, such as Progressive and SquareTrade, allow you to register your phone, used or new, at any time with a purchase receipt. And no, if you break your phone and sign up for the plan, your pre-existing crack isn’t covered. (This is insurance fraud.)

Progressive has a relatively affordable theft and loss deductible: $ 75, with two-year premiums ranging from $ 169 to $ 175, depending on your phone. But there is a caveat: your coverage doesn’t start until 30 days after you sign up.

SquareTrade has a flexible monthly fee of $ 9, with a flat deduction of $ 149 for all damages claims, but has no coverage for theft or loss. This could be a good temporary option for, say, travelers.

Cell carriers tend to charge more. AT&T‘s

phone insurance costs $ 15 a month, more than any of the 10 plans I’ve compared. However, it offers impressive benefits, such as same-day device replacement or repair, up to three claims a year, $ 29 screen repair, theft and loss coverage, and unlimited app space. AT&T photo storage. Even if you never use these other benefits, you at least know that you can make use of this photo storage.

Whatever you decide, my main advice is: get a case to protect your investment, and even if your phone is marketed as “water resistant,” keep it away from water. salty.

(Dow Jones & Co., publisher of The Wall Street Journal, has a business deal to provide news through Apple’s services).

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Write to Nicole Nguyen to [email protected]