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Do you need a mobile phone insurance policy including loss?

With the cost of mobile phones spiralling out of control, many people like to give themselves something of a safety blanket by taking out mobile phone insurance including loss, and while it definitely seems like the smart thing to do when weighed up against the alternative of losing or damaging your phone unintentionally, it could prove to be an expense you don't need.

Unlike car or home insurance, it doesn't matter who you are, where you're from, what age you are or what your track record when it comes to phones is if you're looking to take out mobile phone insurance. Someone who has lost ten phones in the last few years is treated the exact same as someone who has never made a single claim, despite the fact that the latter are the ones subsidising the claims made by the former.

Since this disparity in insurance use doesn't result in differing premiums, it's fair for those who have never lost a phone to give pause for thought when it comes to considering whether or not they will really benefit from an insurance policy.

If we take a look at the insurance cost for the average phone in the £250-400 price range, which costs between £5.17 (with Better Buy) and £6.99 (with T-Mobile) per month, we find that the annual payments come to somewhere between £62 and £84. While this isn't necessarily a huge amount given the initial cost of the phone and the likelihood that any loss or damage would prove to be a substantial inconvenience for the owner, if you add it up over a three years, you're looking at a figure not a million miles away from the cost of a brand new phone.

If you're the type of person who regularly loses phones, then insurance is absolutely essential, but if you're careful with your belongings you've got a much tougher choice to make. Obviously the nature of insurance is that you never need it until something goes wrong, but if you can say with a fair degree of certainty that your phone replacement charges over three years are unlikely to exceed the cost of insurance, then you're probably better off without.

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