View Poll Results: Is purchasing Asurion Insurance a prudent decision or a waste of money?

Voters
125. You may not vote on this poll
  • Prudent Decision. Not worth the hassle of replacing things on my own.

    66 52.80%
  • Rip-Off: I would never (or will never again) purchase this coverage.

    35 28.00%
  • Hi mom!

    24 19.20%
01-06-11 02:03 PM
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  1. mikestorm's Avatar
    I'm starting this thread based on a disagreement I had with my girlfriend. She's purchased Asurion insurance with her dumbphones for years.

    She wanted a BB Curve 8350 for Christmas, so I bought one for her...and didn't purchase the insurance (which I perceive to be a total rip-off).

    Now, over the past few years, I've bought 2 and sold 4 cell phones on eBay. I've bought the two due to puppy teething issues, and always sell my recently retired phone when I get a new one, often times breaking even on the (subsidized) price I paid two years earlier. As such, I take full responsibility for my phones if the unthinkable happens, and this has worked quite well for me.

    My girlfriend on the other hand, was programmed (by her dad) to always buy insurance whenever possible. Trying to convince her of a point of view that isn't her father's is like trying to convince a stone to float. It can be maddening sometimes. Needless to say, she's very upset that her new phone is not covered by insurance, despite the fact that by my math, Asurion is a scam no matter which way you slice it.

    So, I figured I'd come here and get my fellow CBers take on the subject.

    Assuming a $6.00 monthly premium, total cost over 20 months (bare minimum to upgrade NE2) is $120. Add to that the $89.99 deductible should the unthinkable happen, your total price tag is as follows:

    $120 - no claims filed
    $209.99 - one claim filed (filled with new or remanufactured equipment)
    Chance of denied claim: material (we've all heard the horror stories of Asurion denying claims due to technicalities)
    Chance of replacement phone not working: none

    The "mikestorm insurance program" (pay for replacement out of pocket), on the other hand, has the following cost:

    $0 - no claims filed
    $100-$300 depending on timing and device.
    Actual Examples: S2s running for as low as $300, Droids running for as low as $300, S1s running for $175
    Chance of denied 'claim': none
    Chance of replacement phone not working: material (you might get scammed on eBay)

    Droid: motorola droid, Cell Phones Smartphones, Internet Browser. Great deals on eBay!
    Storm 2: storm 9550, Cell Phones Smartphones, SMS-Text Messaging. Great deals on eBay!
    Storm 1: storm 9530, Cell Phones Smartphones, Verizon. Great deals on eBay!

    VZW veribiage on Asurion coverage: Calling Features: Total Equipment Coverage

    The above assumes a like-device replacement. For example, if you drop your Storm2 in the toilet and replace it with an 8330 Curve because your NE2 is two months away and just need something to get you to that point, my process can be even cheaper.

    So, given the above, what do you guys think?
    Last edited by mikestorm; 01-17-10 at 10:57 AM.
    01-17-10 10:18 AM
  2. mjbesen310's Avatar
    if you own a 500 dollar phone, its stupid not to have insurance on it. I have insurance and I have had to use the insurance a few times already in the last couple years.... It would have cost me 1,500.00 bucks without insurance to replace 3 phones, vs 180.00 bucks that I paid for a deductable for the phones...

    Insurance on Blackberrys is a no brainer, you got to have it
    01-17-10 10:26 AM
  3. sedalia066's Avatar
    Insurance companies are in the business of making money. My perspective is just like yours. Many phones over several years without an insurance need. I think of my savings as an investment the next time I buy a phone.

    Posted from my CrackBerry at wapforums.crackberry.com
    01-17-10 10:31 AM
  4. mikestorm's Avatar
    if you own a 500 dollar phone, its stupid not to have insurance on it. I have insurance and I have had to use the insurance a few times already in the last couple years.... It would have cost me 1,500.00 bucks without insurance to replace 3 phones, vs 180.00 bucks that I paid for a deductable for the phones...

    Insurance on Blackberrys is a no brainer, you got to have it
    Mjbesen310, you're forgetting the cost of your premium. That should be added in as well.

    Also, I'm certainly not saying that not having insurance will save you money 100% of the time. However, I do think 3 claims in a couple years is atypical.

    Assuming 10% of insurance holders need to submit a claim over the course of their policy (I'm sure the number is less than that but I want to prove a point) that means that compared to not having insurance:

    90% of people end up saving $120 (savings of not paying Asurion premium)
    10% of people end up paying $90.01 (difference between $300 worst case scenario out of pocket replacement cost and Asurion premium + deductible)

    ($120) * 90% = ($108)
    $90.01 * 10% = $9
    ($108) + $9 = ($99)

    In other words, assuming a 10% claim rate, you still end up saving (on average) $99. That savings is $109.50 assuming a 5% claim rate.
    Last edited by mikestorm; 01-17-10 at 10:58 AM.
    01-17-10 10:54 AM
  5. ERDude's Avatar
    Insurance is a good thing and a bad thing.

    I get my upgrades every year with Sprint, so for the first 12 months I carry the insurance, the $184 ($7 per mo $100 deductible), is a lot cheaper than paying full pop for a phone. If I don't use my upgrade I cancel the insurance, if anything happens I have my upgrade sitting there waiting to be used.

    It is a prudent decision in the first year of ownership and a rip off after the first year.
    01-17-10 11:09 AM
  6. gucci yo's Avatar
    Asurion is good and bad. the good part is that if you lose you phone or it is stolen then you can call in and pay the 50 dollar deductable. No problem. But on the other had You only geet to claims a year so if you are careless like me then you would have to go out a buy a whole new device at retail price.
    01-17-10 11:14 AM
  7. sjsjr's Avatar
    I agree over the long term the insurance is a rip off but here is a different scenario to consider.

    What happens if you fall into a lake/loose your phone/have your phone stolen after one month of service? Your carrier won't help you its not their fault. You have paid your premium for one month and an $89 deductible for a phone that otherwise would have cost you $500 to replace new OR $300 on Ebay. You save money with the insurance in this scenario. And what happens if you only have $150 you can spend right away? You can't buy a similar device to your new one.

    I think it is more of a piece of mind thing. Better to have it and not need it then need it and not have it. If there were a better alternative I would go to that but there isn't. Technically all insurance is a rip off until you need it. I have paid thousands of dollars for car insurance since I started driving and have not received anything back from it yet (thank God) but I am sure happy I have it.
    01-17-10 11:18 AM
  8. mikestorm's Avatar
    I agree over the long term the insurance is a rip off but here is a different scenario to consider.

    What happens if you fall into a lake/loose your phone/have your phone stolen after one month of service? Your carrier won't help you its not their fault. You have paid your premium for one month and an $89 deductible for a phone that otherwise would have cost you $500 to replace new OR $300 on Ebay. You save money with the insurance in this scenario. And what happens if you only have $150 you can spend right away? You can't buy a similar device to your new one.
    Unless I'm mistaken, you are still on the hook for the additional $5.99 premium for months 2 through 20. In other words, at that moment in time, you're "up" with going the insurance route, but you still end up paying the premium for the duration of your contract.

    Ditching the insurance immediately after replacement (is that even possible?) sort of takes advantage of insurance company themselves.
    01-17-10 11:25 AM
  9. Gawain's Avatar
    I used Assurion once and will never do so again. I don't care if it's a good deal or not. If I drop my phone I'm buying a new one and have the means to do so.

    Posted from my CrackBerry at wapforums.crackberry.com
    01-17-10 11:31 AM
  10. michikade's Avatar
    I do insurance because I can't afford a smartphone at retail.

    I don't mind spending the $7/mo (Sprint) to know if something were to happen to my phone I just have to come up with a deductible and not $500+ for a new phone.

    Some of us have the means to pay the bills on a recurring basis and make enough money for all of this, but don't have liquid funds like that.

    Edited to add: I suppose I could save the money and reactivate a dumb phone for the duration of my contract, but honestly I think I would be miserable if I did that. Maybe after this year's upgrade I can cancel the insurance and switch back to my current phone... But with a first smartphone (like I have) I'm not going to take the chance that something happens that isn't a warranty issue and have to be stranded with my POS Samsung Rant until Christmas.
    01-17-10 11:55 AM
  11. CarFan's Avatar
    Rather than full coverage insurance, I keep my old smartphone as a backup.

    Example I'm currently using a 8330 curve I purchased used on Ebay as my primary. My old Palm Centro is my fall back if something happens to the curve. In a couple of months when the new Tour2 is introduced, it will become primary and the Curve will become backup. The Centro will be sold on Ebay to recover part of the cost of the initial 8330 purchase.

    The only thing I purchase insurance wise from VZW is the $1.99 extended warranty coverage (I'm surprised that hasn't gone up!) The deal breaker for me on full coverage is the $90 bucks you gotta cough up as a deductible on smartphones. This setup works for me. I am VERY careful with my phones. I keep them in a case and use screen protectors. I keep all the packaging and paperwork that comes with each phone in excellent condition. This helps me get maximum value when it comes time to sell on Ebay. Minus depreciation of course.
    01-17-10 12:33 PM
  12. gotblackberry's Avatar
    I agree over the long term the insurance is a rip off but here is a different scenario to consider.

    What happens if you fall into a lake/loose your phone/have your phone stolen after one month of service? Your carrier won't help you its not their fault. You have paid your premium for one month and an $89 deductible for a phone that otherwise would have cost you $500 to replace new OR $300 on Ebay. You save money with the insurance in this scenario. And what happens if you only have $150 you can spend right away? You can't buy a similar device to your new one.

    I think it is more of a piece of mind thing. Better to have it and not need it then need it and not have it. If there were a better alternative I would go to that but there isn't. Technically all insurance is a rip off until you need it. I have paid thousands of dollars for car insurance since I started driving and have not received anything back from it yet (thank God) but I am sure happy I have it.
    You beat me too it. Everyone assumes that you'll lose your phone in the last month of your contract.

    Unless I'm mistaken, you are still on the hook for the additional $5.99 premium for months 2 through 20. In other words, at that moment in time, you're "up" with going the insurance route, but you still end up paying the premium for the duration of your contract.

    Ditching the insurance immediately after replacement (is that even possible?) sort of takes advantage of insurance company themselves.

    No you're not, you can remove insurance whenever you want to.
    01-17-10 12:36 PM
  13. mikestorm's Avatar
    No you're not, you can remove insurance whenever you want to.
    Good to know...but dropping coverage after one month due to a very early claim (sjsjr's example) isn't really an argument for the merits of maintaining insurance on your device. If you're not willing to maintain the entire term of the policy, it's hard to argue the policy's benefits.
    01-17-10 12:54 PM
  14. chuckh0308's Avatar
    I think it probably isn't a bad idea on a smartphone for the first six months or so. After that though it doesn't seem to make any sense. Kind of depends a lot on how you are with phones though. Personally I've never needed to have a phone replaced for any reason in 20 years.

    Posted from my CrackBerry at wapforums.crackberry.com
    01-17-10 01:04 PM
  15. gotblackberry's Avatar
    Good to know...but dropping coverage after one month due to a very early claim (sjsjr's example) isn't really an argument for the merits of maintaining insurance on your device. If you're not willing to maintain the entire term of the policy, it's hard to argue the policy's benefits.
    It's based on risk and the fact that you can't predict the future. Yes, when you look at it over 24 months (if you havent had to file a claim) you realize it was a ripoff. Just like when I do not have a car accident for five years, why is my insurance still so high? I don't get that money back. However, you fail to take into consideration that most phone problems happen when customers are not eligible for any other device replacement option. If you're eligible for an upgrade, and don't mind signing an agreement, then the insurance doesn't make sense.

    If you can't shell out $300 for a S2 on ebay at the drop of a hat, the insurance makes sense.
    01-17-10 01:08 PM
  16. Gawain's Avatar
    It's based on risk and the fact that you can't predict the future. Yes, when you look at it over 24 months (if you havent had to file a claim) you realize it was a ripoff. Just like when I do not have a car accident for five years, why is my insurance still so high? I don't get that money back. However, you fail to take into consideration that most phone problems happen when customers are not eligible for any other device replacement option. If you're eligible for an upgrade, and don't mind signing an agreement, then the insurance doesn't make sense.

    If you can't shell out $300 for a S2 on ebay at the drop of a hat, the insurance makes sense.
    Car insurance is totally different. Risk vs. Damage is the non-common denominator. If you can't afford $300 then $90-$100 is going to sting too.

    Posted from my CrackBerry at wapforums.crackberry.com
    01-17-10 01:32 PM
  17. mikestorm's Avatar
    It's based on risk and the fact that you can't predict the future. Yes, when you look at it over 24 months (if you havent had to file a claim) you realize it was a ripoff. Just like when I do not have a car accident for five years, why is my insurance still so high? I don't get that money back. However, you fail to take into consideration that most phone problems happen when customers are not eligible for any other device replacement option. If you're eligible for an upgrade, and don't mind signing an agreement, then the insurance doesn't make sense.

    If you can't shell out $300 for a S2 on ebay at the drop of a hat, the insurance makes sense.
    Auto insurance is so much more than collision. It insures against

    bodily injury liability
    property damage liability
    medical payments
    underinsured / uninsured motorists

    In other words, the true liability of not having auto insurance is very difficult (impossible) to quantify, because the sky is the limit. As such, this type of insurance, accident or not, garners peace of mind.

    Besides, in auto insurance the deductible is (typically) a much smaller fraction of the replacement cost of the car. If your deductible on a $15,000 vehicle is $4,450 (same ratio as an $89 deductible on a $300 phone) not many people would think auto insurance is a good deal.

    Asurion insurance, on the other hand, only has one function: to replace your phone if it gets damaged. This type of insurance is very easy to quantify: the replacement cost of your phone.

    You say that "over 24 months (if you havent had to file a claim) you realize it was a ripoff". Given the cost of premiums plus deductible, the cost associated with the insurance route rivals not having insurance at all. In other words, I'm saying even if you DO have to file a claim, it's still a rip-off. Factor in the very real possibility, that you'll never have an "accident" in the first place, and it doesn't strike me as a good deal.
    Last edited by mikestorm; 01-17-10 at 02:07 PM.
    01-17-10 02:05 PM
  18. gotblackberry's Avatar
    Auto insurance is so much more than collision. It insures against

    bodily injury liability
    property damage liability
    medical payments
    underinsured / uninsured motorists
    Depending on the state that you live in, most of this is not required. Adding these things into your policy will increase your premium and having a lower deductible will increase your premium also what car you have will increase your premium.

    I.E. For my example:

    I have an 2006 M3. It's got underinsured/uninsured, $35,000 property, $50,000 personal injury theft and a $500 deductible full coverage and I pay $350/month. Granted, I have had some tickets in the past but that's what I pay.

    (This is not really what I drive, this was just an example).

    In other words, the true liability of not having auto insurance is very difficult (impossible) to quantify, because the sky is the limit. As such, this type of insurance, accident or not, garners peace of mind.

    Besides, in auto insurance the deductible is (typically) a much smaller fraction of the replacement cost of the car. If your deductible on a $15,000 vehicle is $4,450 (same ratio as an $89 deductible on a $300 phone) not many people would think auto insurance is a good deal.

    Asurion insurance, on the other hand, only has one function: to replace your phone if it gets damaged. This type of insurance is very easy to quantify: the replacement cost of your phone.

    You say that "over 24 months (if you havent had to file a claim) you realize it was a ripoff". Given the cost of premiums plus deductible, the cost associated with the insurance route rivals not having insurance at all. In other words, I'm saying even if you DO have to file a claim, it's still a rip-off. Factor in the very real possibility, that you'll never have an "accident" in the first place, and it doesn't strike me as a good deal.
    The point is that when you look at in the long run it doesn't make as much sense. However, not everyone can come up with $300 to replace a storm2 at the drop of a hat. You may be able to, maybe not. There is a reason we are a society based on monthly payments because it's easier to come up with $6 over 24 months versus $144 dollars. It's easier to come up with $89 versus $300 for a new phone. Over the long run, the cost does add up, but in the short term and for most customers getting insurance is the best idea. (Not necessarily from Asurion, my renters insurance covers my phone)
    01-17-10 02:17 PM
  19. bella0913's Avatar
    Insurance is a must. I've had to return my phones and had to ask for new ones/refurbished many times this past year. Never fails, phones are just not made as sturdy as before. I haven't had to pay anything to get a another phone for the other phones that were defective. its good to have b/c one might always have the money to buy another one, or to be dealing with E-bay or Craiglist.

    Posted from my CrackBerry at wapforums.crackberry.com
    01-17-10 02:41 PM
  20. Polychrome's Avatar
    It depends VERY strongly on the person.

    Are you the type of person who might lose 2-3 phones a year? Maybe insurance is for you.

    If you're careful, don't leave your phone laying around in restaruants without watching it, don't take your phone drinking, don't leave them on top of cars or run over them, have all your old phones available as spares because you're careful with them in general, then insurance isn't for you.

    It's a pretty black and white case. *shrug*
    01-17-10 03:01 PM
  21. Tlynnsmith's Avatar
    Asurion is good and bad. the good part is that if you lose you phone or it is stolen then you can call in and pay the 50 dollar deductable. No problem. But on the other had You only geet to claims a year so if you are careless like me then you would have to go out a buy a whole new device at retail price.
    Try $125. The days of the $50 deductible are over, for me anyway.
    01-17-10 03:15 PM
  22. mjbesen310's Avatar
    You should have just bought your g/f the Insurance instead of being a cheepo. Wait till she losses the phone or damages it somehow and makes you fork up the money to pay for a new phone...
    01-17-10 03:35 PM
  23. gotblackberry's Avatar
    Try $125. The days of the $50 deductible are over, for me anyway.
    For Verizon the price of a deductible is $89 for an advanced device or $39 for a non advanced.
    01-17-10 03:43 PM
  24. mikestorm's Avatar
    You should have just bought your g/f the Insurance instead of being a cheepo. Wait till she losses the phone or damages it somehow and makes you fork up the money to pay for a new phone...
    LOL. That's exactly what she said. Actually I told her I would...MINUS the money she would have paid to Asurion. Since a 2nd gen Curve is currently fetching around $220 right now on eBay (only going to go down as time passes) I feel pretty safe.
    01-17-10 03:52 PM
  25. chuckh0308's Avatar
    Deleted post...lol
    Last edited by ChuckH0308; 01-17-10 at 04:06 PM.
    01-17-10 03:54 PM
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