Insurance can protect you against theft, accidental damage or loss of your valuable electronic devices, so it may seem obvious that having these items insured is a good idea. However, the matter is not quite that straightforward. Insurance comes at a cost, and you really need to work out whether it’s worthwhile.
The value of your devices
If you have low-value devices, then it’s probably not worth getting them insured, as you can easily replace them with new budget devices if they are lost, stolen or they break down. Your own personal circumstances will determine how much you can afford to pay out on replacing devices. For example, if you fork out â‚¤200 for a new Sony Xperia, could you afford the same amount again if your phone is stolen?
Keep in mind that your devices will depreciate in value over time. If you have insurance on a 5 year old device that is stolen or damaged, you will not be able to claim the cost of renewing that item unless your policy specifically states you can do so. Insurance companies will normally only pay out what they deem the item to be worth at the time of your claim.
Before buying insurance for any electronic devices, read your home insurance policy carefully to see if these items are already covered as part of your household insurance. If you own your home and have household insurance, then the policy most likely covers your contents as well, and that would include electronic devices like smartphones, games consoles, tablets, laptops, televisions and desktop computers.
However, you should check carefully to see how extensive that cover is. Standard household insurance is unlikely to cover items that are stolen, lost or damaged outside the home. Another thing to check is if there are upper limits on the amount you can claim for any particular device. You should also check to see if you need to give the insurance company a list of items that exceed a particular value.
If you decide to take out insurance cover and you need to make a claim, you will need supporting documentation, including original purchase receipts. If your device is stolen, you will need to make a report to the police and obtain a copy of that report, or a reference number, to support your claim. Provided all is in order, your insurance company will quickly settle your claim.
Once people claim against their insurance policy, they may lose any no-claims benefits associated with the policy, resulting in higher premiums. It is normal for premiums to rise after a claim. Additionally, making a claim may result in you being unable to change insurance companies.
In conclusion, it can be seen that taking insurance is something of a mixed blessing. You could be paying expensive premiums for years without ever getting anything in return other than peace of mind. If you do have to claim, you will see your premiums go up, and you will eventually end up paying back the amount you claimed.
Isabelle Bray has worked for an insurance company for several years yet still hears the same questions over and over again from worried or confused consumers. Her informative articles are written in the hope of making insurance a little clearer.
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