Do you really need an insurance cover for your expensive gadget? Look at the pros and cons
After losing an expensive mobile phone or laptop, we often regret our decision not to get it insured. Unfortunately, the decison is complicated which explains why not many people opt for insurance cover for their electronic devices.
The idea of buying insurance for gadgets looks good only on paper. Mostly, such insurance is sold at the store from where the device is bought, where physical inspection and verification can be done. So, if you are interested in buying insurance, then first check with the store if they have some arrangements for insurance. But before signing on the dotted line, do read all the terms and conditions of the insurance cover to know what is covered (technical faults, physical damage and theft) and what is not. Ask questions about the coverage limit, like how much you can get in case of technical faults, physical damage, or theft, and whether the full cost is also payable under certain conditions. This will help you avoid some known issues at the time of actual claim.
There are three circumstances, namely, technical fault, physical damage and theft, under which we need insurance. Almost all electronic devices carry a warranty of six months to one year, under which most technical faults get covered. You may have to change the motherboard, but if it’s under warranty, you may get it from the manufacturer free of cost, provided it is being serviced or repaired at the company’s authorised service centre. Remember, if your device is under warranty, always use only the authorised service centre. This will help you overcome ‘warranty void’ issues.
Any physical damage needs to be accidental. And this is difficult to prove. For example, if you mobile fell and got damaged while you were crossing a road, you will have to explain that it was, indeed, an accidental fall and you were not crossing the road in a rush. The other issue is theft. If you have lost your device, or somebody stole it, you are required to submit a copy of the first information report (FIR) and the purchase bill for claiming insurance. Unfortunately, most police stations will not record the FIR; instead they may hand you over a copy of a missing report (MIR) about your device. However, MIR is not accepted by the insurers. This is unfortunate but true in almost all cases of mobile theft, at least in and around Mumbai. Another issue to remember is that if your device is stolen from a vehicle, which was unattended, you will not get any claim. This falls under personal negligence, and the insurer is not responsible for it. Also keep in mind the time limit for filing claims. For mobile insurance, the time limit is 48 hours. This means, you will have to obtain a copy of the FIR, attach the copy of the purchase bill and submit the claim within 48 hours to the insurance company. See how difficult that is!
Insurers also consider depreciation, ranging from zero to 50%, while settling claims. For claims filed within 90 days of buying the insurance, 0% depreciation is considered. For claims filed between 91 to 180 days, the applicable depreciation is 25% and for claims beyond 181 days, it is 50% of the cost.
Last, but not the least, is the cost of buying insurance. Some sellers offer insurance along with the device, if purchased from their shop. But the end price may include the insurance premium. In any case, the premium is not very costly. Usually, the premium is between Rs15 to Rs20 per Rs1,000. Insurance for expensive gadgets can be bought for less than Rs1,000.
Insurance for gadgets appears attractive. But one needs to think and read all the terms and conditions before taking the plunge else it may be a wasted expense. The best thing to do, of course, is to be careful and handle your device with utmost care.