Droids Selling for $49.00 - Why Buy Insurance?

[ZBoater]

I am paying $6 a month for insurance. Assuming I keep this phone 22 months (I doubt it), I could get a new one for $49. Otherwise, I would need to pay full retail or get a used on on eBay for $400-$500 to replace mine in the case of loss or theft.

$6 x 22 = $132. After that I could drop the insurance, as I could get a new subsidized phone if I were to lose mine. $132 to mitigate the risk of a $400-500 loss. Doesn't sound like a good deal (unless you lose your phone 3 months into your contract).

As with any insurance, it is a matter of how much risk you are willing to tolerate. In my case, I will likely be buyng a new phone in 6-12 months anyway (Droid 2?) so this is just to hold me over...

[cuskit]

I am paying $6 a month for insurance. Assuming I keep this phone 22 months (I doubt it), I could get a new one for $49. Otherwise, I would need to pay full retail or get a used on on eBay for $400-$500 to replace mine in the case of loss or theft.

$6 x 22 = $132. After that I could drop the insurance, as I could get a new subsidized phone if I were to lose mine. $132 to mitigate the risk of a $400-500 loss. Doesn't sound like a good deal (unless you lose your phone 3 months into your contract).

As with any insurance, it is a matter of how much risk you are willing to tolerate. In my case, I will likely be buyng a new phone in 6-12 months anyway (Droid 2?) so this is just to hold me over...

That's a very valid point! I've used Asurian 3 times to replace phones in the past (not my droid). All three were $50.00 deductible (you have to add that fee to your calculations per incidence). Though they were certainly cheaper phones (all 3 motorolas) it was still better than buying a new phone - and they were overnighted to me. In addition I was able to keep my battery and charger - yet they sent new ones with the replacement phone. Oddly - I could not tell if they were new phones or refurbs - all looked brand new to me.

Given my history (dropped the first one, broke the glass on the second and third - don't ask...) I'll willingly pay the premium (mine is 5 bucks per month). So I guess we keep the insurance as it appears these cheaper prices are only with plan renewals or new activation (or secondary lines). mike

[STVA]

Personally I think that you should never buy insurance for items that you can replace with cash. You have insurance on your house and car because you can't replace them out of pocket. Just do the math: Add the premium for the life of the contract, plus the deductible to replace the phone. I bet you can buy a lightly used Droid off of eBay or craigslist for less than that, especially in a few months.

If you break phones all the time, just take better care of your stuff. I'm careful with my stuff and have never broken one.

[dfuser10332]

Yep, and I don't have insurance so I just pray that nothing ever happens to it. I really think that if I had paid insurance for every phone I've ever owned I could by 2 or 3 Droids. So if I have to cough up the cash, my bad. I'm still ahead of the game.

I do have the extended warranty that goes beyond the 1 year period. I probably wouldn't have gotten that but phone is in wife's name because we get a discount through her company. She ordered that.

Um, I have two droids on my plan, and we pay $10 monthly in insurance for the two phones combined. That's $5 a phone. $60 per year, $600 over 10 years. So over 10 years you could have paid for about 1 droid, not 2 or 3.

You're right. I was talking without thinking. 5 bucks a month is cheap.

[jayb]

Thats great hope you never have one stole or broke. you are so smart that I cant wait for it to happen to you. WOW! go figure more $$$$$$ than brains

For STVA

[jayb]

I can't believe some people.......$50 to replace a $600 phone.........O BTW only pay 5.99 a month ins.......3 months so far.

[KZIWarrior]

Personally I think that you should never buy insurance for items that you can replace with cash. You have insurance on your house and car because you can't replace them out of pocket. Just do the math: Add the premium for the life of the contract, plus the deductible to replace the phone. I bet you can buy a lightly used Droid off of eBay or craigslist for less than that, especially in a few months.

If you break phones all the time, just take better care of your stuff. I'm careful with my stuff and have never broken one.

With cheap phones you could argue that but not with smartphones like the Droid:
$7/month x 18 months* + $90 deductible = $216... You can be nearly guaranteed that the price of the Droid (off contract) will not go below $216 within the 18mnths* you would need/want it. Personally I treat my phones VERY well but smart-phones in general don't long (USB failure and/or screen damage are almost assured before your 18mnths is up). Add to that flashing ROMs (and for the Droid OC'ing) and the amount of high use most smart-phones get... 18 months is stretching it.

*18 months assumes the standard 2 year contract which allows you to upgrade/renew 6-months prior to contract expiration.

[jayb]

Thank you!!

[cuskit]

Personally I think that you should never buy insurance for items that you can replace with cash. You have insurance on your house and car because you can't replace them out of pocket. Just do the math: Add the premium for the life of the contract, plus the deductible to replace the phone. I bet you can buy a lightly used Droid off of eBay or craigslist for less than that, especially in a few months.

If you break phones all the time, just take better care of your stuff. I'm careful with my stuff and have never broken one.

First - I am very careful with my Droid - certainly more so than my last 3 dumb phones. But I do work in a trade that is "hazardous to Droid health". As such I pay close attention at all times to the careful handling of my phone. That being said - I feel the possibility of the phone breaking, losing it or getting it stolen are NOT worth the risk for a $600 phone. And I seriously doubt any good Droid will be had for just a couple hundred or less in 22 months (my new every two)... As if I'd take a chance on an eBay phone anyway. My business depends on the communications realized with my phone. It's mandatory that I have a quality, working phone at all times.

And if you need to know - yes, I could easily buy a new car "out of pocket". I would hope most responsible adults have made enough investments and wise savings so that if necessary they could purchase a new car. Heck - using your analogy - I can easily buy a replacement for my 2006 F150 on eBay Motors - tons of "lightly used" trucks on the market. Yea right... In a pinch I could also buy my house if necessary, though I'd have to juggle my investments a bit. That luxury results from the same frame of mind that affords me a decision like insuring a $600 phone for only five bucks per month. And I don't make that statement lightly. It's just business. Any good accountant could advise you of the wonderful insurance premium deductions allowed for businesses. Perhaps that was not in your equation?

Nope. Me - as I stated - I'll happily pay my 5 (@$2.50 after tax breaks) bucks per month and have ease of mind knowing that I will never be without my Droid for more than 24 hours at the most.

Sleeping well nights - mikey

[STVA]

I don't believe that $600 is a fair number to use for replacement, no one buys them new at that price and you can buy one off of eBay for less. The insurance company sends refurbs anyway, don't they?

I'm all for everyone making the decision they feel the most comfortable with. I just hate to see some people spend extra money if they haven't done the math or really thought about what they are buying. There are people out there who also buy "extended service plans" from Best Buy that are basically throwing their money away.