Advice: When buying a new mobile phone, should I pay for phone insurance?

Q: When getting a new mobile, should I take out mobile phone insurance?

A: When you sign a mobile phone contract you will normally have the option to buy an insurance policy from your provider. You don’t have to buy this insurance but you should work out if will benefit you.

Whether or not it’s worth insuring your mobile phone will depend on the value of the handset you use, and if you are tied into a contract.

If you have a pay-as-you-go deal and a basic, inexpensive handset, replacing your phone won’t cost you that much money and so it might not be worth paying monthly insurance premiums. However, if you have a very expensive smartphone and a monthly contract, the cost of replacing or repairing your phone can be hundreds of pounds.

Remember that if you don’t have mobile phone insurance, you’ll have to pay for the cost of any unauthorised calls made in between your phone going missing and you reporting it as lost or stolen. Most mobile insurance policies will cover these unauthorised calls, although many may refuse to pay out if you left your phone unattended in a public place or failed to report a theft to your mobile company and the police within 24 hours.

Some networks will cap your bill at £100 if your phone is lost or stolen, as long as you report it within 24 hours.

If you decide you do want to insure your mobile phone you need to check the small print of any policy. You need to find out:

• how much the policy excess is – this means the amount you’ll have to pay before any claim you make is paid

• what kind of exclusions the policy has - for example last location, accidental damage or loss

Before you sign up to mobile phone insurance make sure your phone isn’t already covered by your home insurance or insurance you get through your bank account.

You might be able to find a better deal if you do some research. Other ways to insure your mobile phone include:

• Home insurance - The cheapest option is usually to add your phone to your home insurance as possessions outside the home extra. This will be a lot cheaper than other ways of insuring your phone and other possessions will also be covered. However it’s very important to check the excess on your home insurance policy as it could be £100 or more. You also need to remember that adding your phone to your home insurance policy could end up meaning higher premiums. You will usually get a discount on your home insurance if you don’t make any claims. This means if you make a claim for your phone the cost of your home insurance could go up.

• Stand alone insurance - You can buy a special insurance policy to cover your phone; this is often called ‘gadget insurance’ and there are lots of policies on offer. Comparison websites can help you to find the best deal but make sure you check the terms and conditions of the policy.

Make sure any insurance you buy for your phone comes from a legitimate company.

If you change your mind about an insurance policy you have bought, you have a 14-day cooling-off period, starting from the day you bought it. This means you can cancel the policy within that time and get all your money refunded.

• Get free, confidential and independent advice from your nearest Citizens Advice – go to www.citizensadvice.org.uk/nireland or call at: Citizens Advice Newtownabbey, Dunanney Centre, Rathmullan Drive, Rathcoole, Newtownabbey, BT37 9DQ. Telephone advice is available 9am – 4pm each day on 028 9085 2271 (Lunch 1:00 - 1:30pm), email advice is available at [email protected]