Treating yourself to a new gadget can be so exciting that it’s easy to forget just how much you’re spending, particularly when the toy is a shiny smartphone or tablet that you’ve opted to pay for over a lengthy contract.
But you’ll get a stark reminder of the value when your gizmo is lost, damaged or stolen – you could be facing a loss of hundreds or even thousands of pounds.
That’s why it’s a good idea to invest in some insurance: a few pounds spent now could save you big in the future. Here’s our guide to choosing the right insurance for your electronics.
Step 1: Be wary of in-store offers
Sensibly, you should investigate insurance before buying your gadget but that’s just not the way that many of us behave.
So, perhaps our most important tip is to watch out for sales people bearing insurance gifts.
We’re not suggesting that all in-store or point-of-purchase insurance offers are a rip-off, but you’re unlikely to be in a position to weigh up deals thrust in your direction at the till – so politely decline and then do some research.
Step 2: Check your home-contents policy
If you have home-contents insurance then check your policy, as personal possessions may well be covered. In other words, you might not need separate insurance for your gadgets.
However, understand that there is often a limit placed on how much such a policy will pay out for a single item – typically around £1,500 or so. As well, there might be a maximum total claim for more than one item: this could be a problem if you lose a bag containing several gadgets, say.
Also watch out for clauses that exclude cover for personal possessions that are lost, damaged or stolen away from your home. Even so, you might be able to add such cover more cheaply than buying a dedicated gadget-insurance policy.
Step 3: Use a comparison website…
You probably understand the value of using comparison websites when switching utilities or shopping for mortgages and so forth, but some of them extend their calculations to gadget-insurance policies.
Money.co.uk, for example, allows you to compare quickly dozens of different policies from numerous different providers.
Step 4: …but also do your own research
However, the dirty little secret that comparison websites would rather you didn’t know is that few of them are able to provide ‘whole-of-market’ comparisons. In simple terms relying solely on comparison services means that you might miss better deals.
There’s no quick fix here: if you want to find the best deal you should absolutely start with comparison websites, but then use this information to check offers from providers that don’t appear on comparison services.
Also, don’t be afraid to take information from a comparison website and then check the prices directly with the insurer – as you might actually find a better deal. Insurers to explore include ProtectYourBubble and Gadget Cover.
Step 5: Do your sums
If you’re buying a fancy top-of-the-range smartphone on two-year contract then you will be spending an awful lot of money over the term, so taking out insurance is very sensible.
However, not all gadgets are worth insuring. For example, taking out a year-long, £10 per month insurance policy protecting a £100 tablet is a fool’s choice – you’d be better off putting that monthly tenner in the bank and treating yourself to a new tablet in a year’s time.
You should also factor in depreciation. A brand new iPhone might be worth several hundred pounds now, but in 18 months’ time, not so much. So review how much you’re paying for insurance from time to time and consider hunting for a policy that reflects your gadget’s current replacement value, rather than what you originally paid for it.