Protecting the iPhone: Insurance options

The iPhone is covered under a standard limited one-year Apple warranty, but is not eligible for AT&T’s wireless phone insurance, which (for a $5 monthly fee) will provide replacement in the case of loss or theft, accidental physical or liquid damage or mechanical and electrical failure after the manufacturer’s warranty period has expired.

As such, users are exploring other options for protecting their iPhone purchases. There are three viable options we’ve seen so far:

AppleCare The AppleCare Protection Plan for iPhone will be available this month, according to Apple — it will extend the hardware repair coverage to up to two years from the original purchase date of the iPhone, and must be purchased covered under Apple’s One-Year Limited Warranty for iPhone. AppleCare won’t cover against liquid damage, theft and accidental physical damage, however — only against “defects.” Essentially it simply extends the standard one-year warranty.

In fact, the AppleCare terms and conditions state specifically that the plan does not apply to:

“Damage to the Covered Equipment caused by accident, abuse, neglect, misuse (including faulty installation, repair, or maintenance by anyone other than Apple or an Apple Authorized Service Provider), unauthorized modification, extreme environment (including extreme temperature or humidity), extreme physical or electrical stress or interference, fluctuation or surges of electrical power, lightning, static electricity, fire, acts of God or other external causes.”

SquareTrade This company is currently offering a “CarePlan” for the iPhone that mimics AppleCare and costs 10% of item price - $49.99 - $59.99 for the iPhone. The company says “If something does happen, we’ll either fix it, or pay you the full $499-$599 that you spent on the phone – All within 5 days. Guaranteed.” Like AppleCare, this plan does not protect against accidental physical damage.

However, SquareTrade says it will soon be offering a plan that does protect against the same type of damage as AT&T’s wireless phone insurance:

“We’ll also be providing consumers with an enhanced CarePlan with accidental damage coverage (something that an AppleCare warranty doesn’t offer) in a few short weeks. […] check back with us in a few weeks and protect your iPhone from drops and other minor accidents, i.e. coffee is not a friend of the iPhone.”

Homeowners/renters’ insurance extension Some insurance companies, like State Farm, offer a “floater” policy that, for ~$30 annually, will protect items like the iPhone from accidental damage, theft and similar occurrences. Generally these plans require that you already have home or renters insurance. Policies vary from state to state and by carrier, so check with your insurance company for details.

If you know of any other options for protecting the iPhone, please let us know.