AppleCare and other phone protection plans: who should – and shouldn’t – buy them

Apple’s standard warranty didn’t cover damage even though the phone was only a few months old because the fall was an accident. The invoice for the replacement of the screen? $ 140.

Yes, this repair blow stung. But do I regret missing out on AppleCare +, which would have reduced my personal costs? Nope.

A cracked screen was enough of a lesson. Since that fateful incident in 2016, I have yet to take another phone for repair. And I’m not alone: ​​a 2016 Verizon VZ 0.33%

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

If you, like me, are the type of person who generally takes care of your phone and covers it with a case, then 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 the money is made by Apple and others, ”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 don’t think about the probability.”

The main problem, Professor Kunreuther says, is that phone retailers know the likelihood of damage to the phone – at least based on the phones they take for repair – but they don’t release that data. We consumers have to calculate the risk ourselves. And we are bad at it.

When I went looking for research on the topic, most of the so-called studies were published by companies that intended to sell blanket. They often had misleading statistics or glaring omissions.

If you have a new phone while on vacation and are considering activating a coverage plan, I can see how that makes sense. The warranty included with the purchase covers only manufacturing defects, not accidents. And the price of repairs has gone up: 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 fixes (broken camera, defective mic) can cost up to $ 449.

Apple quietly expanded its coverage in the fall, making the AppleCare + program appear more successful. Customers can now claim two damages per year, instead of two claims every two years. The theft-and-loss plan (an additional $ 70 on top of basic AppleCare +) now charges a $ 149 deductible for stolen or misplaced phones, down from $ 269.

When you look at individual numbers, it may seem like buying a blanket is saving you money. Only $ 29 for an iPhone or Galaxy screen repair! But don’t forget to take this bonus into account.

There are many numbers to think about, so let’s take a look at some cost scenarios. First off, here’s what might be of most concern to someone who just bought a high-end iPhone:

Broken iPhone 12 screen

• $ 279 – If you have no cover and break your iPhone screen.

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

• $ 149 – If you bought the plan and don’t break your screen.

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

Maybe you are not prone to breakage, but are worried about a stolen or lost phone. This is how it goes with Samsungof

latest:

Lost Samsung Galaxy S21 Phone

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

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

• $ 312 – If you pay for two years of Samsung Care + and don’t lose the phone.

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

The most important consideration is probability. Are you ready to bet Apple that you will definitely break your screen? Or bet on Samsung that your phone will be lost forever? Of course, someone reading this might skip the coverage plan and regret it later, but statistically that person is in the minority.

Also, your probability of damage drops dramatically if you slap on a high quality case made with non-smooth material and raised edges that will protect the screen. You can even add a PopSocket or a ring for an even more secure grip.

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

You may not even need to consider the hedging plan bet. Some credit cards offer phone protection as a benefit. 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 is $ 50 and you can make two claims per year.

Many home and tenant insurance policies do not cover accidental damage, but do include theft out of the home under personal property coverage. This covers smartphones, although the deductibles are often high. My policy deductible 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 would be covered. Hippo, a home insurance startup, and Toggle, the tenant insurance arm of Farmers, allow customers to choose their deductible when choosing a policy, as low as $ 500 on Hippo and $ 100 on Toggle.

When should you buy a plan

The economy may be different if you can’t afford to wait for repairs – Apple and Samsung offer overnight replacement phones, and some cell phone carrier insurance plans may even deliver same day.

Otherwise, these extended coverage options are best for large klutz. If you break a phone at least once a year, sign up. The question is, what plan? You can purchase extended coverage from your phone manufacturer, your mobile carrier, or a third party.

Most require you to register within a certain timeframe 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 then sign up for the plan, your pre-existing crack is not covered. (It’s 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: its coverage does not take effect until 30 days after you register.

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

Cell carriers tend to charge the most. AT&Tof

Phone insurance costs $ 15 per month, more than any of the 10 plans I’ve compared. However, it does offer some impressive benefits including same day device replacement or repair, up to three claims per year, $ 29 screen repair, theft and loss coverage, and space. unlimited in the AT&T Photo Storage app. Even if you never use these other perks, you at least know that you can actually use this photo storage.

No matter what 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 salt water.

(Dow Jones & Co., publisher of The Wall Street Journal, has entered into a business agreement to provide information through Apple services.)

—For more analysis, reviews, tips and headlines on WSJ technology, sign up for our weekly newsletter.

Write to Nicole Nguyen at [email protected]