The Ins and Outs Of Gadget Insurance - Forbes

Mobile phones, smartwatches, and wireless headphones have become an essential – but expensive – part of modern everyday life.

Many of us now carry around numerous hi-tech gadgets all day, every day – perhaps without even realising it. 

But if you couldn’t afford to replace your tech if it was lost or stolen, it might be time to look at gadget insurance.

What counts as a gadget?

Your smartphone might be the most obvious gadget you take with you everywhere – but there are other devices too. 

These include fitness trackers, smartwatches, sat-navs, webcams, cameras, netbooks, Kindles, MP3 players, Bluetooth speakers, laptops, hand-held games consoles, and headphones.

Are my gadgets already covered?

Before you buy gadget insurance, you should check if your gadgets are already covered on existing insurance policies.

They might be covered by your:

• home insurance
• packaged bank account
• a warranty
• travel insurance (if abroad)

What will home insurance cover?

Many gadgets will be covered by your home contents insurance policy. When you take a policy out, you might be asked to list those items above a certain value.

This might all sound good but if you check the policy small print, you’ll find that most home insurance policies won’t automatically cover devices taken out of the home.

This is problematic as, by the nature of their purpose, many gadgets such as smartphones, laptops, navigation devices and headphones are generally taken out and about every day. Also, it’s when you’re away from home that your tech products are more likely to be lost, stolen or damaged.

For your gadgets to be properly covered by home insurance you need to add on ‘cover away from home’. Even then, your policy might not cover accidental damage in or out of the home; you’ll need to add ‘accidental damage’ to your policy too. 

What will my bank account cover?

Several packaged bank accounts offer mobile phone insurance as a perk, but other gadgets are rarely covered. If your smartphone is your only gadget, cover provided by your bank might be enough. But if you have other tech devices it might be wise to look at gadget insurance. 

What will a warranty cover?

Most tech you buy will come with a warranty for one or two years. This typically covers mechanical breakdowns, but not accidental damage or theft.

What does gadget insurance cover?

A decent gadget insurance policy should cover:

• all your gadgets under one policy
• expensive gadgets that might not be covered by home insurance
• accidental damage to your tech products
• lost gadgets
• theft of your gadgets both inside and outside of your home, and abroad
• unauthorised use of data on your smartphone, tablet or laptop
• mechanical breakdown of a device after the warranty expires
• water damage to your devices

As with all insurance, read the policy documents carefully before taking out gadget cover so you are absolutely clear on what’s covered and what’s not. 

Double check if you need to separately list items above a certain value, normally £1,000.

Do I need gadget insurance?

You should definitely consider buying gadget insurance if you:

• couldn’t afford to replace your gadget if it was lost or stolen
• are covered on your home insurance policy but it has a high excess
• would benefit from a product replacement in 24 hours
• are prone to losing or breaking items
• own several gadgets
• use devices such as fitness trackers, webcams, and headphones while out and about
• carry a laptop, tablet or netbook with you a lot of the time 

What is an excess?

All types of insurance come with an excess. This is the amount you have to pay in the event of a claim before the insurance starts covering the cost.

The excess on your home insurance will usually be higher than the excess on a gadget insurance policy.

What exclusions does gadget insurance come with?

Every insurance policy comes with exclusions – these are things that are not covered. Typical exclusions on a gadget insurance policy include: 

• unauthorised use of your phone if you haven’t notified your network provider within 24 hours of your gadget being lost or stolen
• loss of data, files, apps or downloads stored on your gadget 
• claims arising in the first 14-days of your policy
• gadgets purchased outside the UK
• devices purchased from auction sites
• wear and tear or cosmetic damage
• stolen items without a police reference number and proof or purchase
• negligence – for example, if you left your gadget in an unlocked car
• if abroad, travelling in a country against Foreign, Commonwealth and Development Office (FCDO) advice 
• if overseas, any trip that lasts longer than the maximum trip stated on the policy

How do I make a claim on gadget insurance?

Call your insurer on the claims number as soon as you can. Have details of your claim to give over the phone – for example, information about what happened to cause the loss or damage. 

If your gadget needs repairing, contact your insurer first before arranging any repairs.

If your device has been stolen you will need a crime reference number from the police. You may also need to provide proof of purchase. 

If your smartphone is lost or stolen, contact your network to stop your phone being used. If you don’t do this, you could be held liable for any call or data charges incurred by the thief. 

It depends on the policy, but be aware that some gadgets (especially smartphones) will be replaced with a refurbished device, not a brand new one.

If your device can’t be repaired, or it’s been lost or stolen, you may be sent the value in cash (by bank transfer) or by cheque.

How much does gadget insurance cost?

Gadget insurance is normally fairly cheap – typically under £10 a month, and sometimes just a couple of pounds a month. How much it costs depends on:

• how many gadgets you want to cover
• the value of your devices
• the total amount of cover you need
• where you live
• the excess on the policy
• whether you pay monthly or annually
• whether you upgrade to ‘family cover’ to cover all the devices owned by members of your household
• what the policy covers – some policies just cover theft and loss, others also cover breakdown and accidental damage

Gadget insurance is sold by:

• mainstream insurance companies
• specialist insurance companies
• banks
• price comparison sites
• retailers

Always make sure you shop around and compare gadget insurance quotes to get the best deal. 

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