Cell phone insurance vs warranty: what’s the difference?

So, you've got a new phone. While figuring out the difference between cell phone insurance and a cell phone warranty isn't exactly as fun as picking out your new device, protecting your new tech is just as important. In this article, we'll explain the difference between cell phone insurance and an extended warranty – that way you can make the best choice for your situation.

What's the difference between phone insurance and a warranty?

Many wireless carriers offer phone insurance and warranty options for their customers. Now that we have a baseline for what each term means, let's get into what makes them different – it comes down to what they cover.

What is a manufacturer's warranty?

A manufacturer's warranty is when you buy something, and the manufacturer issues a promise to repair or replace your purchase if necessary – within a specific timeframe. For example, if you were to buy a new phone, the manufacturer's warranty is usually for one year starting after the purchase date – depending on the manufacturer.

What is an extended warranty?

An extended warranty allows you to receive the same amount of coverage issued by the manufacturer for a longer period of time. Typically, you pay upfront (at the time of purchase) for 1 or 2 years of additional coverage and may be eligible for additional fees later if you need service.

What does a phone extended warranty cover?

In most cases, phone extended warranties cover malfunctions like electrical failures and mechanical failures from a manufacturing defect after the manufacturer's warranty expires. To put it simply, it covers situations where the phone does not fulfill its intended purpose. For that reason, extended warranties do not cover lost or stolen phones.

What is phone insurance?

Cell phone insurance is a protection plan for your phone that covers situations where it's lost, stolen or damaged. With most insurance programs, you pay month-to-month as long as your coverage continues. If you decide to discontinue your coverage, you can cancel at any time.

What does cell phone insurance cover?

Similar to a warranty, cell phone insurance covers electrical and mechanical failures – but that's where the similarities end. Cell phone insurance also covers if your phone is lost, stolen or damaged — even liquid damage. Looking at you July 4th, the most dangerous month for your phone.

Learn if adding a phone insurance plan is worth it for you.

What does “Accidental Damage from Handling" mean?

Accidental Damage from Handling or ADH is a subcategory under damage that includes drops, spills and cracked screens. Cell phone insurance designates three subcategories of damage: liquid damage, Accidental Damage from Handling and comprehensive damage, which is all other damage beyond AHD.