Why are you paying for cell phone insurance?

April 11, 2017

by — Posted in Credit Card Games, Discount Strategies, Lifehacks

Cell phone insurance is absurdly expensive; most US-based carriers offer it for about $10 per month, per line. For a family of 4, this means you’d be spending about $500/yr for phone insurance, with each claim having a $50 or $100 deductible. How does this make any sense at all? Given the rapid depreciation of cell phones, it really just doesn’t make much sense to pay this kind of money.

Think about it. Most cell insurance policies will only replace your current phone with a similar model, which may be used, and will certainly be worth much less than what you paid for it if it breaks. And you have to cover the deductible. So your iPhone 5s breaks or gets stolen. Insurance covers you, but you pay a $100 deductible. Well. Guess what iPhone 5s models are going for on ebay and resale sites right now. Yeah. Somewhere around $99.

The awesome thing is that you can actually get better cell phone insurance for free. All the Wells Fargo consumer credit cards have cell phone coverage. “Pay your monthly cellular telephone bill with your eligible Wells Fargo Consumer Credit Card and you’ll get up to $600 protection (subject to a $25 deductible). Coverage may include up to four cell phones as listed on your wireless cell phone bill. The cellular telephone is protected against damage or theft, however coverage does not include cell phones that are lost.” (Yeah. That’s right. Their free insurance is better than your expensive insurance.)

This is the best no annual fee Wells Fargo card. (Only charge your cell phone bill to it, because Wells Fargo sucks. Crooks…)

Own a small business? Chase and the First National Bank of Omaha also issue business cards with cell phone insurance. The Chase Ink Preferred card ($95 AF) covers your phones, up to $600 per occurrence. So does FNBO (with a couple $0 AF cards).

So. Why are you paying for cell phone insurance? I just don’t get it.

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