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Computer Insurance and Warranties: Should You Buy Either One for Your Gadgets?

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According to a Consumer Reports study, one out of three electronic gadgets will experience a major malfunction within four years of use. Keep in mind that most manufacturers’ warranty is only valid for 90 days to a year; that translates to out-of-pocket expenses for incurred damages caused by bugs and hardware failure any point after the warranty expires.

Just as there is insurance for your home, vehicle and health, there is also insurance that has you covered in the event that your laptop, smartphone, tablet or video game console is rendered inoperable due to a crash, malware or physical damage. Whether you think computer insurance is worth your peace of mind is a personal judgment call, and there are multiple variables that factor into your decision.

Extended Warranties

Aside from the manufacturer’s warranty, which is typically included in the purchase, buyers also have the option of purchasing an extended warranty. For the most part, if you have the extended warranty, then insurance is not necessary, though be sure to read the fine print and know exactly what the warranty does and does not cover. Typically, the manufacturer’s warranty will only cover defects caused by faulty design, while extended coverage also has you covered in the event you drop your device and crack the screen, spill coffee on the keyboard, inadvertently download malware, or cause any other damage where you are at fault.

Warranty plans are provided by the manufacturer or store where you made the purchase. You will be asked at the time of purchase whether you want to pay for extended warranty, which is normally 10% to 15% of the base price of the device and good for anywhere between two to five years. Most buyers will also have 30 days from the day of purchase to opt for extended warranty should they decline the initial offer.

So are extended warranties really necessary? Some experts recommend opting for the warranty for devices $750 and over. For gadgets under $300, a warranty is generally not needed since you will be better off buying a brand new device altogether. Anything between $300 and $750 comes down to your judgment call. Of course, these are arbitrary numbers, so it’s a judgment call regardless.

Computer Insurance

If you decide to get coverage after the 30 days, then you can opt for standalone insurance for one or more of your devices. This may be more beneficial in a sense as you will have more options and are sure to find a policy with just the right premiums and deductibles that suits your needs. Additionally, there are also packages that cover multiple devices under a single plan.

Consider the following companies if you feel computer insurance is worth a look into:

Worth Ave. Group – This company insures smartphones, tablets, laptops, desktops, e-readers, video game consoles and just about any other electronic device under the sun. The business has been in operation for 40 plus years and also provides special policy programs for college students. Individual policies cover devices whether they are new, used or refurbished, and policyholders benefit from premiums as low as $4 per month and $0 deductible. Worth Ave. Group also takes great pride in making an educational impact among the communities it serves and has donated electronic devices and provided technology grants to students from disadvantage backgrounds.

Safeware – This company was founded in 1982 and provides policies for individuals, small businesses, academic institutions and large enterprises. Aside from being a fully licensed insurance agency, the company is also a third party administrator for extended warranties. This gives consumers the benefit of choosing a customized insurance or warranty option that is best for their needs. Safeware has been rated an A+ by the Better Business Bureau and also underwrites for some of the top rated AM Best insurance companies in the nation, including Fortegra Financial Corporation and AMTrust Financial Services.

Square Trade – Square Trade offers three and four year plans. Its policies cover hard drive crashes, RAM failure, mechanical error and other failures that your normal manufacturer’s warranty may not cover. The company does the repairs, and policies cover the cost for parts, labor and shipping and returning. It has also generated over 600 reviews from past and current clients through Google Reviews with a 4.9 average out of five stars. Furthermore, Square Trade has also received praise from established and trustworthy news stations like Fox, NBC and CBS News.

With the purchase of any expensive item comes the decision of whether to supplement the purchase with insurance or warranty. Even if you don’t ever need it, it does put your mind at ease knowing that you’re covered in the event your device is spitting out smoke or showing signs of its age.

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