Should you insure your gadgets on your home insurance or buy standalone cover?

It’s often said you don’t need to buy separate insurance for gadgets such as your mobile phone or tablet, because they can be covered by your household policy.

Here, we look at some of the pros and cons of relying on your household insurance for gadget cover, and how standalone cover differs.
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What do home contents policies cover?

Depending on the insurer you’re with and whether you opt for ‘budget’ cover or a more expensive policy, most contents insurance will:

  • Let you add on accidental damage cover – normally for a small fee.

  • Cover your possessions while they are away from your home – for an extra fee.

  • Insure specific items that are worth more than, for example, £2,000, through ‘valuable items’ cover.

In order to use this cover, you’re normally required to specify the make and model of the item (if relevant) and/or have receipts or photos to show you owned it.

Gadget insurance

You can buy separate gadget cover from several different sources:

  • A specialist insurer. Several insurance companies offer gadget insurance that will protect one or several mobile phones, tablet computers, laptops etc. For example, insurer Protect Your Bubble offers cover for up to three gadgets from £14.99 a month and Insurance2Go allows you to insure individual gadgets starting from £3.49 a month. Other providers of gadget cover include Switched On Insurance and My Gadget Buddy.

  • Your bank: If you pay for a premium account (otherwise called ‘packaged account’), you may be offered gadget insurance as part of the deal.

  • The retailer or manufacturer you buy the gadget from. Mobile phone retailers, manufacturers and network providers will usually offer mobile phone insurance when you sign up for a deal.

What to watch out for

Whether you’re buying separate gadget insurance or adding the cover onto your household policy, it’s worth checking exactly what you’ll be covered for. It sounds obvious, but cover can vary widely, particularly around what counts as theft and whether calls made by someone who steals your mobile will be covered. Look for:
  • The deferred period, which is how long you have to have the policy before you can make your first claim. This may be 14 days.

  • The age of the gadgets. Some policies won’t insure anything that’s older than three years old when you first take out the insurance.

  • How your claim will be paid. Some policies will only pay the price of the item at the time you bought it, rather than the new replacement price. This isn’t so much of a problem with gadgets as prices have been falling for quite a few years, but it’s worth being aware of.

  • Limits on the cost of unauthorised calls made on your mobile after it’s been stolen or lost. Policies may not cover the cost of mobile calls if you don’t report your phone lost or stolen to the police or mobile phone company within 24 hours.

  • The level of the excess.

  • The maximum amount the company will pay out for each claim. This could be as low as £1,500, which may not be much use if you lose several expensive gadgets at once.

  • Theft exclusions. If your laptop is stolen from your car, for example, it may not be covered if it’s not locked away in the boot. Some policies state that alarm systems must be activated as well. Some policies say they won’t pay out for theft from a building unless forced entry has been used.

  • The limit on the number of claims you can make in a year.

Pros and cons of household versus gadget cover

If you’re the kind of person who tends to lose or damage things, you’re probably better off buying separate gadget cover. The reason is that if you make a relatively low value claim against your household insurance, you will lose your no claims bonus, which could mean your insurance costs rise significantly. Even if you don’t have much of a no claims bonus, your premiums could go up after you’ve claimed.

Graeme Trudgill of BIBA (the British Insurance Brokers’ Association) has these tips:

  1. You may have a higher excess on your household insurance than you’d get on gadget cover.

  2. If you lose a mobile phone, your household insurance will cover you for the cost of a replacement phone, but not for the cost of any unauthorised calls.

  3. Talk to a broker about gadget insurance as some are quite restrictive when it comes to what counts as ‘theft’. BIBA can help you find a broker here or you can call them on 0370 950 1790.

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