Gadget Insurance: Do You Actually Need It?

It was the perfect trip until you realised that somewhere between the museum tour and the three-course lunch, a pickpocket made off with your mobile phone. 

You break into a cold sweat, but are then overcome with relief as you remember: my contents insurance includes electronics insurance, right?

The good news is that Lemonade Contents policies do cover electronic devices like smartphones, eReaders, and laptops in the event of a “named peril” like fire, lightning, vandalism, or burglary. But you’ll want to make sure you’ve got the right amount of cover, and picked the right add-ons.

If you’re in a rush, here are some key things to know:

TL;DR

• Basic contents insurance policies cover the loss or damage of electronic or mobile devices in the event of named perils, but won’t cover negligence or wear-and-tear.
• Your device manufacturer’s warranty or device protection plan may cover losses or damages that a standard insurance policy won’t compensate.
• Lemonade’s Theft & Loss cover and Accidental Damage to Mobile Device add-ons boost your policy, covering your electronics and appliances in situations that most standard insurance policies don’t cover like liquid damage, worldwide cover, and cracked screens.

Here’s what we’ll cover:

• What is gadget insurance?
• Does contents insurance cover your gadgets
• Do I need gadget insurance cover?
• Don’t my gadgets have a warranty?
• What do I do if my gadgets have been stolen?
• What if I lose my gadgets?
• What documentation do you need from me?
• Will I receive the full worth of my gadget if something happens to it?

What is gadget insurance?

Gadget insurance offers you cover for all your pricey mobile devices items, including: mobile phones, laptops, cameras, tablets, music players, eReaders, and GPS devices.

If something happens to any of your devices, could you afford to replace them without selling off your sister’s first born?  If the answer to the above is “no”, then think seriously about getting gadget insurance.

Does contents insurance cover your gadgets?

You’ll be pleased as punch to find out that you already have insurance for your gadgets under your contents insurance. On the other hand, if you don’t have contents insurance, you might just decide to buy some. That’s because contents insurance covers most of your worldly possessions, and if you live in the 21st century, those might include an iPhone, maybe an iPad, and definitely a TV, or gaming console. 

Your basic policy covers all these electronics for named perils in your policy. If you skipped the policy documents, those perils include things like fire, lightning, smoke, explosion, burglary, robbery, vandalism, civil unrest, windstorms, hail, earthquakes, flooding, collision by vehicles, aircraft, or falling objects (e.g. trees). While a basic contents policy covers a lot, it won’t have you covered for every single circumstance your gadgets might find themselves in. 

For instance, if your gadgets are old and experiencing some wear and tear, you won’t be covered by contents insurance, as this is considered an exclusion to cover. You might have also noted that a mobile phone falling into the loo isn’t on that list. That’s why Lemonade has created add-ons that you can purchase for those exact situations.

Lemonade’s Theft and Loss add-on

First off, Lemonade offers a Theft and Loss cover add-on. 

“But isn’t theft already covered in my base policy?” you may ask.

Yes, but old school insurance defines theft as ‘burglary’, and unfortunately, that only goes as far as theft from inside your home. So, if someone breaks into your home by force and makes off with a laptop, you’d be obviously shaken, but could confidently file a claim with your insurance company. But if the same thing happened at a coffee shop… it would be another story. So, Theft and Loss cover just gives you that worldwide cover for theft (yes, even in Ibiza as long as you’re there for less than 3 months—this add-on is not a replacement for travel insurance!).

Let’s talk about cracked screens. The bane of our existence. One in five mobile phone users in the UK have cracked their screen by dropping them, according to a YouGov poll. Perhaps even more surprisingly, a massive 77 percent of all UK mobile phone users have no insurance for their device, and only 56 percent even cover their phones with protective cases. Talk about tempting fate.

At Lemonade we have a gold standard add-on named Accidental Damage to Mobile Devices—catchy name, we know. This add-on covers you (as long as you don’t purposely stomp on your gadget in a fit of rage) for almost all forms of damage, including cracked screens.

We’ve partnered with BeValued, who will actually come pick up your damaged mobile device and repair it using only original parts. What if your device needs to be replaced? Smartphones will be replaced with a refurbished, Grade A (mint condition) mobile. All other devices will be replaced as-new.

Do I need gadget insurance cover?

This really depends on how many gadgets you own, and how accident-prone you are (no judgement!). A good way to figure out whether you should consider a gadget insurance policy is to make a list of all the types of gadgets you own; include your digital camera, smartwatch, consoles—the lot. If you think you have enough money to replace them in one go if they were to get destroyed, then great, maybe you can do without the cover—but if that’s not the case, you should definitely consider purchasing a contents insurance policy. The cool thing about your policy is it covers all your gadgets, which means you won’t need to take out separate policies on your laptop and mobile phone, for example. 

Don’t my gadgets come with a warranty?

Your gadgets probably came with some kind of manufacturer warranty or guarantee for its first year. Things like defective keyboards, hard drive failures, and mechanical breakdown caused by faults in the product are usually covered by this warranty.

A warranty won’t cover you if you’re left with a cracked screen when you fall and step on your laptop. That’s because accidental damage is usually considered ‘negligence’ (you shouldn’t have left it on the floor), as opposed to a defect in the hardware or software of your device. However, if you’d had the smart sense to purchase the Accidental Damage to Mobile Devices add-on, you’d be sorted because that’s exactly the type of damage you’d be covered for. 

In addition to getting your add-ons, if any gadget is worth more than £2,000 you’ll want to add some high-value item cover to each item to be covered to its full worth.

Adding high-value item cover protects your gadgets for all your named perils, for items worth more than £2K . Different insurance companies might use different language to describe exactly what they cover, so make sure to read the full details of your policy. Your high-value item cover doesn’t cover you for different circumstances than your named perils unless you’ve purchased your add-ons, so don’t mistake one for the other. If a gadget is valued at over £2K and you want to insure it for as much as possible and gain some peace of mind, you’ll want to purchase Theft and Loss cover, Accidental Damage to Mobile Device cover, and apply for high-value cover.

What should I do if my gadgets are stolen?

Contents insurance or not, you’ll always want to inform the police if anything untoward happens to you or your stuff. Call 999 (if you’re in danger) or 101 (if it’s not an emergency). Give the police as much information as you can. Don’t forget to ask for a crime reference number as you’ll need this later when you file your Lemonade claim. 

Remember, if your personal items were stolen from your home due to a break-in (burglary), you’re covered with a base contents insurance policy. However, if your personal items were stolen from your favourite coffee shop, or it disappeared from your home without a sign of break-in, you’d only be covered if you have our Theft & Loss Cover add-on.

What should I do if I lose my gadgets?

It depends on the context. 

If you lose something while you’re out and about, you won’t be covered unless you have our Theft and Loss Cover add-on. And if something completely disappears from inside our home, and there’s no sign of a break-in, you still wouldn’t be covered without the add-on. We recommend you register any item you’ve lost on Report My Loss. Once you’ve completed the form there, you’ll receive a lost property reference number that you will need to share with us when you make a claim.

What documentation do I need to file a claim?

When filing a claim, it’s always very helpful if you have proof of purchase for your stuff. But we know that not everyone saves their paperwork (and you might have received more than a few gifts over the year). If you don’t have a receipt for an item, our team will work with you to confirm that the stolen or damaged items actually belonged to you. In general, though, do try to keep your receipts for the more expensive stuff you buy—say, £250 and up. That way, we can settle your claim faster.

Will I receive the full value of my gadget if something happens to it?

We offer 100% replacement value for any destroyed, damaged, or stolen items.

This means we will pay you the cost to repair or replace an item (whichever is lower) based on the price of a new item of the same make and model, without any deductions. If the exact item is no longer available, we’ll reimburse you for the amount  of buying a replacement of equivalent type and quality. In other words, we don’t pay less to account for how used your item was at the time of loss.

Keep in mind that if you need to make a claim on a gadget, and it’s approved, you’ll get the value of that item, minus your excess. 

What’s an excess? It’s the amount subtracted from your claim in the event that something happens to your stuff. Think of it as your contribution to the claim.

When signing up for a contents insurance policy, you’ll be asked to choose an excess between £100 to £500. The lower the excess you pay, the higher your premium, and a higher excess might mean a lower premium, but it means you pay up more every time you file a claim. Choose which option makes the most sense for you when you pick your excess amount.

If you want to potentially get reimbursed for gadgets that are worth more than £2K, you’ll need to increase your level of cover by adding some high-value item cover. As long as you included the Theft and Loss, and Accidental Damage cover add-on, your items worth over £2K will be fully covered.  

Gadgets are expensive, and after shelling out serious ££, the last thing you’ll want to do is replace it if things go sour. Take Lemonade for a swirl – it’ll take you less than 3 minutes.