On Cyber Monday scores of people pick up new phones or tablets to go under the
Christmas tree. But it's important to be wary of buying more insurance than you
need for these and other gadgets. Where's the good in nabbing a bargain
otherwise?
Research has shown that shoppers are so focused on scoring their shiny new
phones, tablets or other devices that they don't stop to consider the details
of insurance policy, a small detail often slipped under their noses.
We spoke to Gráinne McEvoy, the Central Bank's Director of Consumer
Protection, about how savvy shoppers can save even more money by being mindful
about insurance, and what they should keep in mind when buying that new phone.
Here are her top tips.
1. Donât pay more than you need to
One in five consumers already pay twice over for their gadget insurance, purely
because they fail to cancel their old gadget insurance policy before taking out
a new one. This can mean they are paying on the double. So be sure to ask if
you need the cover you are offered or whether you are already covered under an
existing policy.
2. Watch out for the "excessââ & any "exclusionsââ
Devices only last for so long. Don't pay for insurance for more years than they
will last
Like other insurance products, a gadget insurance policy may incur a policy
"excessââ - a fixed amount that you have to pay towards your claim which
can vary with each insurance provider. So if your excess is, say â¬75, and you
make a claim to have your phone repaired or replaced, you will have to pay
â¬75 towards the cost of the claim. Also be sure to ask about any exclusions
â e.g what is not covered under the policy.
3. Donât pay for longer than you need to
Many gadgets today don't have a long shelf life, and often need replacing after
just a few years. Despite this, some shoppers insure the gadget for a longer
period than its likely useful life. Why pay gadget insurance on a mobile phone
that may be long dead and gathering dust in a drawer?
4. Be sure you know how to make a claim
As well as not knowing you're paying more than you should be for insurance,
many of us don't even know how to make a claim should something go wrong. The
Central Bank recently inspected three insurance firms and two intermediaries
accounting for over 80 per cent of the gadget insurance market in Ireland.
While insurers accepted almost 92 per cent of gadget insurance claims, research
shows that many firms could improve how they make consumers aware of the key
features of the gadget insurance they sell them in the first place - including
how to make a claim.
In order to make a successful claim, consumers must report the loss or theft of
the handset to their mobile phone provider, the Gardaà (where required) and
the insurer within the timeframes specified in the policy. Policyholders should
also supply the insurance firm with all the information and evidence required,
in order for the insurance firm to verify the validity of the claim
5. Read the policy
All the effort of finding a phone at a brilliant bargain price is lost if you
don't have a good understanding of the insurance being offered. We found that
firms need to provide more information to consumers when buying gadget
insurance. So if youâre about to buy a new phone this Christmas and want to
insure it, make sure the seller explains the policy to you and the point of
sale and take the time to read it, so that you fully understand what you are
paying for.
6. Weigh up the pros & cons
Ask the firms to explain what policy they're selling you
Ultimately, the decision of whether or not to avail of gadget insurance will
depend on your personal circumstances, including how likely you are to lose or
damage your phone or other gadget. Next time you buy a new gadget, consider the
insurance that is on offer and evaluate if it meets your needs and expectations
before you put your hand in your pocket.
7. Ask the firms to explain
As the sellers of insurance, firms have a responsibility to explain what you're
buying. The Central Bank expects to see firms guiding consumers to make choices
that are in the interest of consumers, not just in the interest of the firmsâ
bottom line. So donât be afraid to ask the firms to explain the finer details
to you.
8. You have time to change your mind
Finally, if you do choose to insure your gadget, remember that you have a legal
right to a cooling off period of 14 days during which you can cancel the
contract without penalty.
Happy shopping!
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