Research indicates that Singapore has the highest smartphone penetration in the world. At 82% in January 2018, this is quite an incredible statistic. Interestingly, 75% of the Singaporean population confirms that it has a smartphone.
Further, the research indicates that 91% of the smartphone owners use them for browsing the internet. Interestingly, most of this number uses their smartphones to connect with friends and family on social media.
Which is precisely why it is worth considering mobile insurance. Our mobile devices have become such an integral part of our day-to-day lives that many of us would like to afford it some form of protection.
It is no doubt that we often find ourselves distracted and engrossed in whatever content we might be viewing on our smartphones. Therefore, it is no surprise that in our distracted state we may accidentally damage our phones. Interestingly, the majority of Singaporeans damaged their phones while sitting down.
On the other hand, many of us have found ourselves struggling to hold too many items at once and lose a grip on our mobile devices. We may find that even with protective cases and screen-guards, your smartphone is likely to suffer a few bumps and scratches.
In light of this, it is tempting to consider mobile insurance. Already, there are companies offering insurance packages for exactly this niche. Some of the firms include Singtel and even HL Assurance through their MobileCare plan.
These insurance plans promise to cover the cost of repair, and even to repair broken mobile phones. In particular, there are insurance plans as low as $7 to $36 a month. However, the question remains, is mobile insurance worth it?
To get a grasp on the implications of the questions, we shall consider a study by ValueChampion. According to the study, all insurers charge deductibles. Basically, this is the amount the policyholder has to pay before the insurer can pay out an insurance claim.
Per the research, most of the deductibles are quite large. Usually, most plans ask for s$100 deductible before you can make a claim, assuming you pay a premium of $100 per month.
Different Case Scenarios
To decide whether mobile phone insurance is worth it or not, let us take a look at two different scenarios. In the first case scenario, assume you buy a smartphone for S$999 after which you take insurance. For the initial payments, you pay $100 as a deductible.
Soon after you leave the shop, you bump into a pedestrian and your phone drops, your screen is now cracked. If you go back to the store to claim a replacement, you will get a brand new phone. If you do the math, you will save (999-100) = S$899.
In the second scenario, assume the same case where you buy the same phone and take insurance. In this case, you take care of your phone for 13 months. After the 13th month, you drop your phone from your lap onto the tiled floor of your porch, the screen is once again cracked.
Going back to the shop, you will still get a replacement with a similar version the phone. Interestingly, the phone could be grossing at a lower price than the initial price, say S$859. During that time, the monthly premium amounts to S$1300. In addition, you will have to pay the $100 deductible before you claim the replacement.
If you do the math, the scenario will be as follows. (859-1300-100) = -541. Interestingly, you will end up losing S$541. Therefore, whether it is worth it or not, it depends on the situation.
In conclusion, it boils down to how well you look after your devices. Having said that, it is impossible to predict every single accident. If you prefer to stay cautious, mobile insurance can provide you a sense of peace.