Home insurance and your cell phone – two things you probably wouldn’t want to live without. With top-of-the-line smartphones now approaching $2,000, more and more consumers are seeking protection for their devices. But with so many buzzwords thrown around, it can be hard to know what’s covered and by whom. So, here’s everything you need to know about insuring your cell phone, laptop or smartwatch.
- Options for protecting your devices
- Square One’s personal property coverage
- Making a claim on your personal property insurance
- Frequently asked questions
Options for protecting your devices
You’ve just bought a new cell phone. It’s the latest top-of-the-range model and cost more than you’d care to admit. So, how do you protect it?
Chances are, during the purchase transaction you were offered some form of extra protection. Phrases like ‘extended warranty’, ‘protection plan’ and ‘third-party insurance’ are common, but often misunderstood. Moreover, the type of protection you require depends upon the specific type of loss you’re worried about. So, let’s take a look at the various options available to you, and what they cover.
Many people confuse the terms warranty and guarantee; and it’s easy to see why. Put simply, a warranty is a written promise. A guarantee is the details of that promise as contained within the warranty. Confused? Let’s delve a little deeper.
The word ‘warranty’ has various definitions depending on the context. For example, in the insurance industry, it’s defined as an assurance that certain material facts are correct, or that certain conditions will be fulfilled. In retail however, the definition of a warranty is more akin to an assurance of quality. Think of a warranty as a promise from the manufacturer that its product meets a certain standard. If the product fails within a given timeframe, the manufacturer agrees to repair or replace the product if it can be shown that the issue was not caused by the user.
Warranties are issued by the manufacturer (think Apple, Samsung, etc.) and are often limited in scope and time. You may find that your new phone comes with a 1-year warranty that excludes breakage to the screen, for example. So, if your phone suddenly stops charging, your laptop won’t turn on, or your smartwatch has a glitch, the manufacturer may assume responsibility for this, providing (a) your device came with a warranty; (b) the warranty hasn’t expired; and (c) you can prove that the fault with your device doesn’t result from damage inflicted by you.
This brings us to protection plans offered specifically by the manufacturer. (Think AppleCare or Samsung Premium Care). Essentially, these plans prolong the duration of the warranty for your device. Some manufacturers offer several levels of protection, but even the most comprehensive packages may not protect against damage caused by negligence. You can find more supporting research for warranties over at Cellphones.ca.
Protection plans are usually offered through your service provider (think Rogers, Bell, etc.), although third-party providers such as Asurion are increasing in popularity. For a monthly fee, they’ll protect against accidental damage caused to your device. So, if your phone is lost or stolen, you’ll be able to replace it with a new one. Beware, though, there may be a catch. Many protection plans limit the number of claims you can make. And be sure to read the agreement thoroughly; you may find that you need to pay a deductible of several hundred dollars in the event you’re forced to make a claim.
Most home insurance policies include coverage for personal possessions and cell phones, laptops and (some) smartwatches are usually included as part of this coverage. So, if you’re a policyholder, you may already have coverage for your devices without even realizing it!
The bad news is that when you make a claim with your home insurance provider, not only will you need to pay a deductible, but some providers place a limit on the amount they’ll pay out for electronics. In these cases, it may not make financial sense to file a claim.
Square One’s personal property coverage
The good news is that Square One isn’t most home insurance providers. We understand the importance of electronics in the modern world, so we treat your phone and laptop just the same as the rest of your personal property. We let you select your own limit for personal property, with a wide range of options to cater for all lifestyles.
Our policies also replace your property on a ‘replacement cost’ basis, rather than giving you the ‘actual cash value’. Simply speaking, this means that if your phone is stolen, we’ll replace it with a new one, rather than deducting the value of depreciation based upon your phone’s age and condition.
True, you’ll still need to pay a deductible, but with Square One, even this is easy; we let you select a deductible that you’re comfortable with- something you can realistically afford in the event of a loss.
And the best part? In addition to personal property coverage, you’ll also receive Square One’s comprehensive protection for your home and your liability exposures.
Get a quote in less than 5 minutes and find out just how affordable personalized home insurance can be, click here.
Making a claim on your home insurance
If you’re thinking about making a claim on your home insurance, the first step is to consider whether the loss itself is covered. For example, if your device simply won’t turn on due to defect or breakdown, most home insurance policies will not respond. Contact the manufacturer for warranty service. But if your phone was lost or stolen, we may be able to help.
If theft was involved, your first step should be to report the crime to the police. Make sure to keep hold of any reports or case file numbers they provide you, as your adjuster will need to see a copy of this later. Next, contact your home insurance provider. Square One makes reporting a claim easy; in fact, you can do the whole process through your online account.
Then, work with your adjuster. They’ll be in touch soon to collect the details of your loss. Once your claim has been accepted, you’ll work with your adjuster to arrive at a settlement you’re happy with. Square One provides the opportunity for you to upgrade to a different model of phone (or laptop) at your own cost, if you choose.
Frequently asked questions
Is my smartwatch covered by my home insurance?
That depends on what kind of smartwatch you own. Check your policy for details, as some will be classified as jewellery, some as electronic devices. At Square One, we classify any device that is used to adorn the body as jewellery. So, your Apple Watch, your Samsung Galaxy Watch, or your Fossil Smartwatch would be classified as jewellery. Since not everyone needs jewelry coverage, Square One doesn’t include it by default, so be sure to add this coverage if you’d like to protect one of these devices. On the other hand, simple devices that are worn around the wrist (such as a Fitbit or a step tracker) will be classified as Personal Property, and therefore automatically included under your Personal Property coverage.
Can I claim for my lost phone?
Yes. Some home insurance policyholders maybe not be aware that accidental damage caused to property is covered under contents insurance. So, if your phone slips out of your hand and into the pool, if you lose your laptop at the library, or if your Fitbit falls off your wrist while you’re jogging, your home insurance can respond.
There will, however, be some requirements. As mentioned above, your settlement will be subject to a deductible, but you‘ll also have to prove that you prevented further loss from occurring. So, to use the above example, if your phone falls into the pool, get it out as soon as possible- it may be possible to repair the phone rather than needing to replace it entirely.
How will my phone be replaced if I make a claim on my contents insurance?
This depends on the type of coverage provided in your policy. As highlighted above, Square One replaces items on a ‘replacement cost’ basis. Other providers may deduct the value of depreciation from your settlement.
Is my child’s laptop covered under my home insurance?
That depends. You may find that your family members are covered under your home insurance even if they no longer reside at your property. The key here is dependency. If your children are still financially dependent upon you for their well-being, they’re probably covered under your policy. So, if they’re living away from home while studying at university, but you still pay their bills, chances are, they’re covered. However, always be sure to check with your home insurance provider. Square One’s policies will automatically extend to dependent children at school, but not all home insurance providers are guaranteed to do the same.
Is insurance available if my laptop is used for work?
The short answer is: yes, but you may need to select additional coverage.
Most employed people who use a laptop for work won’t be required to pay for it upfront, even if they bring it home with them each night. In these circumstances, the employer is responsible for insuring its property. However, if you’ve paid for the computer yourself, you are responsible for it. In both instances, your personal property coverage will only respond to a loss if it includes items that are used for business. If it doesn’t automatically include items used for business, this is usually available at an added cost. Learn more on how we assist customers with home based businesses.
What else should I know about making a claim on my home insurance?
To ensure a smooth and quick process, it’s a good idea to keep a receipt for any valuable items of personal property; be they your phone, laptop or even your sofa. Keep a photo of the item (and of the receipt) to use as proof of ownership in the event you need to make a claim.
It’s also worth noting that, for customers with large deductibles, claiming for electronic devices may make little financial sense. Increasing your deductible may result in a lower premium as you are effectively self-insuring against smaller losses, such as these.
Finally, consider that any claim you do make on your home insurance will become part of your home insurance claims history. A history of frequent or large claims may result in an increased renewal premium, or difficulty renewing or applying for insurance in the future.
Still have insurance questions? Check out common insurance questions.
For more information on insuring your personal possessions, contact Square One at 1.855.331.6933 and one of our licensed insurance agents will be happy to answer your questions. Get a quote in less than 5 minutes and find out just how affordable personalized home insurance can be, click here.