Do you really need mobile insurance?
India being the third largest smartphone market, its mobile theft statistics are also scaling new highs. Here’s what you need to know about mobile insurance
Look around yourself and you’ll realise that mobiles have become an essential part of our lives. Though smartphones gained popularity only over the last few years, India is the fastest growing smartphone market, among the top 20 markets globally, recording a robust 14 per cent growth in 2017 with a total shipment of 124 million units.
In contrast, China, the world’s largest smartphone market, reported negative growth in smartphones last year. An average Indian spends three hours and 20 minutes on mobile internet every day. Undoubtedly, smartphones have become an integral part of our lives, but have we done enough to safeguard our smartphones?
India’s insurance penetration rate is less than four per cent, so it is safe to assume that less than four out of 100 people are buying mobile insurance.
Why mobile insurance?
While India is the third largest smartphone market, India’s mobile theft statistics are also scaling new highs. At least 100 mobile theft cases are reported in Mumbai local trains every day whereas in Delhi, nearly seven mobile phones are stolen every hour. Additionally, the warranty you get on purchase of a new phone only covers technical faults in your device and hence, taking mobile insurance is a prudent decision. Mobile insurance compensates not only damages but also loss or theft. It also covers damage from fire, strike, riots, terrorist activities and accidents.
Mobile insurance comes handy even when the warranty of your mobile device expires. Normally, a warranty lasts for a year, while an extended warranty feature is offered to new smartphone buyers. Typically, smartphones work very well for first 2-3 years, so warranty often goes wasted. For understanding purposes, warranty is like health insurance, since it will compensate only for technical faults while mobile insurance is a combination of health and life
There are a few exclusions which one must be aware of before buying mobile insurance. They are — the insurance will not cover theft from unattended vehicle unless it was securely locked. If the phone was given to a third party who lost the phone or damaged it, that won’t be covered. Mechanical or electric breakdown, damage from wear and tear, mysterious disappearance or willful act by the insured party.
While claiming insurance, the insurance company will give you the replacement cost of the phone after deducting charges and depreciation. The depreciation rate is very high for mobile phones. For a device that has been used for 0-3 months, it is around 15-20 per cent; for 3-6 months depreciation is 25-30 per cent and for 6-12 months it can go up to 50 per cent. So, if you lose a phone worth Rs 50,000 in first three months, you are likely to get back Rs 40,000-42,500. One should also check if there is any co-payment clause in the insurance policy.
Co-payment means a certain percentage of claim must be borne by the owner. So, in the above example, if the co-payment is 5 per cent, then you will have to pay Rs 2,000-2,125 out of the total compensation.
One should take mobile insurance policy within 2-15 days of buying mobile phones. The insurance premium may vary in the range of 6-10 per cent of the invoice bill amount. A few companies offering mobile insurance are New India Assurance, Quick Heal Gadget Insurance, Onsite Secure and Times Global Insurance.
How to claim insurance?
When you lose your insured mobile phone or if it gets stolen, you will have to file an FIR with police station within 48 hours of your phone loss. You will have to submit the FIR and the original mobile bill to the insurance company to claim insurance. Do remember, phones bought in the grey market don’t get original mobile bill, so they are not eligible for mobile insurance.
In case of damage, you will have to submit repairing bill obtained from the authorised service centre along with the original bill to the insurance company.
The insurance company might ask for a few other documents such as self attested photo ID proof of claimant, a cancelled cheque and duly stamped and signed SIM blocking letter and/or email copy from your mobile service provider.
Given the huge volume of data, photos, contacts, not to mention our private information, buying a mobile insurance is soon becoming the need of the hour.