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Apple iPhone and iPad Insurance Options: There's No Perfect Solution

Apr 29, 2011

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Discover how to protect your Apple iPhone 4, iPad, or iPad 2 against damage, out of warranty malfunctions, loss, or theft by purchasing optional insurance. Plus, learn about the benefits of purchasing Apple's own AppleCare extended warranty, which includes unlimited technical support for two years. Jason Rich helps you achieve peace of mind when using your Apple mobile device, knowing that should something go wrong, you're financially protected and have a plan in place to quickly repair or replace your damaged, lost ,or stolen device.

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Although you may initially spend only $199.00 or $299.00 for a new iPhone 4 (in conjunction with a two-year service agreement with AT&T Wireless or Verizon), if you lose or damage the device in a way that's not covered by Apple's initial warranty or AppleCare extended warranty, you'll need to purchase a replacement phone at a much higher price (up to $649.99 for the 16GB model or $749.99 for the 32GB model) or pay an early termination fee to your wireless service provider of up to $350.00 and wind up with no phone.

Should something go wrong with your iPad or iPad 2, you might have to pay to replace the unit outright if it's lost or stolen, or at least pay a hefty repair bill for out-of-warranty or not-covered problems.

Four of the most common mishaps people have with their iPhone or iPad are these:

The unit gets lost.
The unit gets stolen.
The unit gets damaged by liquid.
The unit gets accidentally dropped.

Unfortunately, none of these problems is covered by Apple's warranty or AppleCare.

You can gamble on the fact that you won't encounter any of these problems. Or, if you do, you could potentially purchase a used or refurbished iPhone 4 or iPad on eBay.com, for example, as a replacement for your original device, instead of buying a new one. The cost of a used or refurbished iPhone 4 ranges from $200.00 to $300.00 (potentially more for the 32GB model).

Available for the iPhone or iPad, the optional AppleCare extended warranty plan has a few advantages, especially for non-tech-savvy people. For two years, AppleCare offers unlimited and extemporary technical support in person at any Apple Store or by telephone. Plus, the optional AppleCare plan offers hardware coverage of the iPhone or iPad, as well as its battery, earphones, and included accessories.

However, this coverage protects only against manufacturing defects and workmanship. According to the AppleCare Protection Plan for iPhone Terms and Conditions, the coverage does not protect against problems that are "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."

The coverage also does not offer protection against loss or if the device gets stolen, although Apple does offer its free online-based Find My iPhone or Find My iPad service through MobileMe, which must be activated by the user (www.me.com). Once turned on by the user, it's possible to use any Internet-connected computer to pinpoint the exact current location of an iPhone 4, iPad Wi-Fi + 3G or iPad 2 Wi-Fi + 3G, providing the device is turned on (and not in Airplane mode).

For a monthly fee of $10.99, Verizon offers insurance for the iPhone 4 that does cover much more than what AppleCare offers, but a deductable of up to $199.00 may be applied to each claim.

Meanwhile, for the iPhone 4, AT&T Wireless offers MobileProtect (www.mymobileprotect.com) coverage through a company called Asurion Insurance. For details, download the company's free MobileProtect for iPhone app from iTunes (http://itunes.apple.com/us/app/mobileprotect-for-iphone/id371405127). This policy, which costs $11.99 per month, must be activated within 30 days of the iPhone 4's initial activation. A deductible of up to $199.00 will apply per claim. This insurance covers such things as a cracked screen, water or liquid damage, loss, theft, accidental damage, and out of warranty failure.

For insurance coverage of an iPhone or iPad against loss, theft, or accidental damage, for example, you can also acquire third-party insurance, which is offered by a handful of companies. Use Google, for example, in conjunction with the search phrase, "iPhone insurance" or "iPad insurance", to find insurance companies that offer optional coverage for Apple mobile devices.

Two such companies include SquareTrade and Worth Ave Group. Both of these companies offer one- or multi-year insurance coverage for any model iPhone or iPad. What's covered under each policy varies. In many cases, a $50.00 deductible applies per claim.

As you evaluate the various policies and extended warranty programs, determine what's covered and what's not, how much of a deductible you'll be charged per claim, and how repairs or product replacements are handled. Ideally, you want a policy that offers next-day equipment replacement.

Table 1 offers a summary of insurance coverage costs for iPhone 4, iPad, and iPad 2 through AppleCare, SquareTrade, Worth Ave Group, AT&T MobileProtect, and Verizon.

Table 1: iPhone 4, iPad and iPad 2 Insurance and Extended Warranty Coverage Options

Device	*AppleCare()**	SquareTrade()**	Worth Ave Group()*	AT&T MobileProtect	Verizon
iPhone 4 (16GB or 32GB)	$69.00 / 2 years	$99.00 / 2 years / No deductibles	$89.00 / 1 year / $50 deductible per claim	$11.99 per month / up to $199.00 deductible per claim	$10.99 per month / up to $199.00 deductible per claim
iPad 16GB—Wi-Fi	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$32.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 32GB—Wi-Fi	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$37.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 64GB—Wi-Fi	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$52.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 16GB—Wi-Fi + 3G	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$38.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 32GB—Wi-Fi + 3G	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$53.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 64GB—Wi-Fi + 3G	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$59.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 2 16GB—Wi-Fi	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$37.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 2 32GB—Wi-Fi	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$52.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 2 64GB—Wi-Fi	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$57.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 2 16GB—Wi-Fi + 3G	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$53.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 2 32GB—Wi-Fi + 3G	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$59.00 / 1 year / $50 deductible per claim	N/A	N/A
iPad 2 64GB—Wi-Fi + 3G	$79.00 / 2 years	$95.99 / 2 years / No deductibles	$67.00 / 1 year / $50 deductible per claim	N/A	N/A

* AppleCare only offers two-year plans that are not renewable.
** SquareTrade offers two- or three-year plans. No deductible applies in most cases. See the company's website for details.
*** Wentworth Ave Group offers one-, two- or three-year insurance plans for Apple mobile devices. A $50.00 deductable applies to claims. See the company's website for details.

Purchasing insurance or an extended warranty for your iPhone 4, iPad, or iPad 2 is optional, and like any type of insurance, offers piece of mind and financial protection should something go wrong. Since many people become extremely reliant on their Apple mobile device, having this added protection could save a lot of frustration and stress, plus provide for quick equipment replacement if something goes wrong.

Regardless of whether or not you opt to protect your Apple hardware, it's essential that you regularly back up your apps and data using iTunes, and/or create backups of important data files, photos, and videos created on your device using an online-based cloud service such as DropBox or MobileMe, for example.

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