You have just committed to a £1,000 phone on a two-year contract and the retailer offers insurance for a few pounds a week. Whether that is worth it depends on the odds of a claim, the excess, and whether you are already covered elsewhere.
Check what you already have
- Home contents insurance. Many policies cover phones at home, and some cover them away from home for a small extra premium. Check the excess and whether a claim would push up next year's premium.
- Packaged bank accounts. Accounts with a monthly fee often include mobile phone insurance for the account holder and sometimes family. Register the phone with them — cover is not automatic.
- Manufacturer plans. Apple, Samsung and Google sell their own cover, usually with a lower excess for screen repairs than third-party insurers.
What to look at in any policy
- The excess. A policy with a £100 excess on a £150 screen repair is barely worth claiming on.
- What is excluded. Loss (as opposed to theft) is often excluded or extra; so is unattended theft from a vehicle; so are accessories.
- Replacement terms. New, or refurbished? Same model, or "equivalent"? How long does it take?
- Whether it covers you abroad, and for how many days a year.
The self-insurance alternative
If you have never broken or lost a phone, the maths often favours putting the premium aside yourself. Over two years at a typical monthly price you would have saved a sum that covers a screen repair with plenty to spare, and if nothing happens the money is still yours. A good case and a screen protector reduce the odds further and cost a fraction of one month's premium.
When insurance makes sense
If you cannot afford to replace the phone outright while still paying the contract, if your job or lifestyle puts the phone at real risk, or if you have a history of breaking them — then it is worth having, and the manufacturer's plan or a specialist insurer usually beats the checkout offer. Whatever you decide, do not let it be decided for you by a tick-box during checkout.