Oops! Drop that smartphone? Welcome to the crowd. But there may some comfort in discovering that you can purchase insurance coverage for that cell.
It’s getting harder and harder to function in today’s world without mobile technology. But when it comes to protecting those indispensable smartphones, tablets and laptops, many consumers are woefully unprepared — mentally, emotionally and financially — to deal with a loss.
The mobile nature of many tech devices can make them more prone to theft, loss and accidental damage. At the same time, the lost or compromised files and information contained within the technology can often be far more devastating than the loss of the device itself. But despite these challenges, there are options for those interested in pursuing coverage.
“Most homeowner’s policies as well as business policies have coverage for computers,” said Stewart Perry, agent and co-owner of Perry & Perry State Farm Insurance. Some policies can be limited when those computers are used off-premises, however, and coverage can vary a great deal from policy to policy in terms of the hardware, software and lost data involved.
“You need to be careful that you have enough coverage to replace the information that is included on your computers as well,” Perry said. Re-creating lost data can be an expensive and tedious process, Perry said, even for companies that take measures to ensure regular back-ups of vital information, but some insurance policies will help companies with the cost of hiring extra labor to recreate those important files after a loss.
With the recent rash of vehicle break-ins experienced in many different Lexington neighborhoods, Perry said he has seen an increase in claims for laptop theft.
“For laptops, the No. 1 risk is theft,” Perry said. “It is just so easy to leave laying in the car.”
Perry’s agency no longer covers smartphones, iPads and iPhones. More and more agencies are dropping coverage of the devices, he said, primarily because their on-the-go use and fragile nature has resulted in an exorbitantly high number of claims.
“I’ve had iPads that were run over, iPhones dropped in toilets, or the dog ate them — quite literally,” Perry said.
Kentucky Farm Bureau offers insurance coverage for laptops and some of the more expensive smartphones on the market through their homeowner’s insurance policies, said John Wood, agency manager at the Kentucky Farm Bureau office on Versailles Road. However, there is no distinction between a claim for a mobile device and any other homeowner’s policy claim, Wood said, and deductibles do apply.
“As long as it’s for personal use, they can endorse it on the homeowner’s policy,” Wood said. Kentucky Farm Bureau offers separate options for clients who want to insure their devices for business use as well.
Wood said many of his clients use the coverage to protect the laptops that their kids take with them to college.
“You see probably more of that than you do of anything else,” Wood said.
The typical college laptop is insured for between $500 and $1,000, Wood said.
It is important for a client to remember that to insure a device, the serial number, make and model must be provided upfront, Wood said.
“I am not insuring any laptop; I’m only insuring that specific laptop,” Wood said. “If it’s not listed with the serial numbers, it’s not covered.”
When mobile devices are lost or stolen, identity theft also becomes a very real concern, Perry said. Protection against it is sometimes included in today’s homeowner’s policies, and if not, it can often be added for a minimal cost.
Insurance coverage tailored to mobile devices for both individuals and businesses is also available online through companies such as Safeware, SquareTrade, Protectyourbubble.com and Worth Ave. Group. Plans typically cover losses attributed to theft, drops and spills, liquid submersion and other accidental damage. Deductibles range from about $50 to $120. The plans will cover the cost of replacement, but they typically don’t include any movies, music, games or data that might have been loaded on the device.
Costs for the plans vary as well. Protect yourbubble.com quotes Kentucky policies on smartphones, including the new iPhone 5, starting at $8.15 per month and tablet insurance at $10.19 per month. Worth Ave. Group quotes a one-year plan for an iPad 3 at $37 to $67, and a one-year iPhone 5 plan at $79 to $89.
But no matter what insurance option one chooses, customers who have concerns about their coverage are best served by checking with their agents before a claim becomes necessary, Wood said.
“It’s always better to be safe and call first to ask questions, rather than asking questions after the fact,” Wood said.
Perry agreed, adding that with the speed of today’s technological advancements and upgrades, regular insurance check-ups are also a good idea. Perry encourages people to meet with their insurance agent every three or four years to ensure that they do not have any gaps in their coverage.
“People update their computers and they never think about calling their insurance agents,” Perry said. “When it comes to computers, it is exceedingly important that your insurance agent knows what you’ve got and what you need protection for. The worst time to find out that you have the wrong coverage is after you’ve had a claim.”