What Is Electronics Insurance and Is It Worth It?

Electronics insurance can take many forms, cover different types of devices, and come with varying costs and stipulations. It’s not as standardized as auto insurance. Yet, given how interconnected we are with our electronics, technology coverage is worth considering.

It’s worth taking time to understand the protection you already have available to you — and where coverage gaps might exist. The right electronics insurance policy can help you plug those holes. We’ll help you make sense of your options.

What is electronics insurance?

Broadly speaking, electronics insurance helps protect you from financial loss when things go wrong with your devices. Depending on the type of coverage you have, this could include things like replacing your cell phone if it’s stolen or getting a cracked screen repaired.

Gadget insurance might cover just one device or all your devices, depending on the type of policy. You might have to pay extra for coverage, or you might already have coverage for some types of claims if you have a homeowners insurance policy, renters insurance, or a credit card.

Electronics insurance also goes by many different names, which may or may not describe overlapping products:

• Service contract

• Extended warranty

• Electronics protection plan

Homeowners and renters insurance also cover consumer electronics for some losses under the personal property section in your policy. Coverage for electronics is usually limited to a smaller amount, though, unless you buy a separate rider for it.

You’ll also need to file a claim, and your deductible may exceed the value of the device. And a claim could lead to a rate increase down the road. Similarly, manufacturer warranties offer protection only against manufacturing defects, not for things outside the business’s control.

How electronics insurance works

A stand-alone electronics protection plan typically covers only the specific devices you bought it for, such as laptops, tablets, or appliances. But some companies sell plans that cover your combined consumer electronics. Often, they’ll cover common types of damage, such as spills, power surges, and theft, by paying for repairs or a replacement.

What devices does electronics insurance cover?

Depending on the insurer, you may be able to get coverage for a wide range of tech devices, such as:

• TVs

• Tablets

• Laptops

• Cameras

• Appliances

• Smartphones

• Smartwatches

• Gaming consoles

• Desktop computers

• Smart home systems

• Home theater systems

• Robotic household appliances

Some companies won’t offer coverage for certain types of tech, such as refurbished items or laptops you use for your business — which, according to the IRS, even includes your side hustle.^[2] That’s why it’s important to read the terms and conditions of the contract before you purchase coverage.

What kind of damage does electronics insurance cover?

Damage coverage also varies widely depending on the type of policy you have. Here are some common things that technology insurance might cover:

• Breakage from drops and other accidents

• Component failures

• Device malfunction

• Liquid damage

• Misplacement or loss

• Repair fees

• Theft

Many device insurance plans exclude certain things from coverage, like cosmetic damage. Generally, they also won’t pay for financial losses your broken electronics may cause, like lost income if you earn money online.

And personal property coverage through home and renters insurance typically covers you only for 16 different “named perils,” like fire, theft, and vandalism. Those policies won’t cover accidents like dropping your device and breaking it yourself.

Pros and cons of electronics insurance

Paying extra for technology insurance might be worth it for some people, but it’s not right for everyone. Here’s what to consider before you buy:

Where to buy electronics insurance

You can get technology coverage from many different sources. Here are a few:

• 

  Retailers

  If you’ve bought any kind of consumer electronics, the seller — Target, Walmart, Best Buy, etc. — likely offered you a protection plan at the time of your purchase. Be cautious of these plans and make sure you understand the terms and conditions before buying one.

• 

  Credit cards

  Many credit cards offer automatic extended warranties for tech you buy with your card.^[3] Check your credit card’s benefits guide.

• 

  Manufacturers

  Often, manufacturers will offer a limited warranty for their work that covers issues such as screen malfunctions (that you didn’t cause, that is).

• 

  Independent insurance companies

  An increasing number of specialty insurers and even major insurers offer a separate extended warranty or electronics protection plan that you can buy. They may also sell true insurance plans that extend coverage beyond what the manufacturer offers.

• 

  Your homeowners or renters insurance

  Standard policies offer limited technology coverage, although you can buy separate riders that offer a higher limit.

Cost of electronics insurance

If you pay extra for technology coverage, the costs can vary widely depending on what type of insurance policy or warranty options you buy. Here’s a sample of what some gadget insurance companies charge:

• Progressive advertises two-year consumer electronics protection plans for less than $8 per month, based on a coverage quote for a smartphone, tablet, and laptop, with deductibles ranging from $50 to $100.

• Lemonade offers an equipment breakdown coverage endorsement for existing homeowners policies. Coverage ranges from $2 to $3 per month, with a $500 deductible.

• Akko offers smartphone protection plans ranging from $5 to $12 per month, with deductibles from $29 to $99.

Electronics insurance FAQs