Cellphone insurance is little-known perk with some credit cards

Handful of cards offer protection if device goes kaput of missing

John Egan
Personal Finance Writer
Writes trendy stories about credit cards.

Which credit cards offer cellphone insurance?

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When your cellphone is lost, stolen or just stops connecting you to the world – your credit card might have you covered.

A handful of credit cards include cellphone insurance, meaning that a tiny percentage of cards will be a financial lifeline when you need to replace something that 95 percent of Americans own.

This rare credit card benefit – and one that cardholders with cellphone insurance often aren’t even aware of – can be valuable if your cellphone is stolen or damaged.

How valuable? The average smartphone in North America costs $567 in 2017, and more than 5 million cellphones were lost or stolen in the U.S. in 2015.

Which cards offer cellphone insurance?

Every consumer credit card issued by Wells Fargo provides cellphone insurance as a perk, as does the Uber Visa card from Barclays, the U.S. Bank Visa Platinum card, the First Citizens Cash Back Rewards Visa card, Fifth Third Bank’s TRIO and Truly Simple credit cards, Navy Federal Credit Union consumer Visa and Mastercards, and the Chase Ink Business Preferred card.

Among business credit cards, the Chase Ink Business Preferred card appears to be the only one that supplies cellphone protection. With this card, cellphone insurance is in effect for you and any employees listed on your monthly cellphone bill as long you make phone payments with the card.

In general, to qualify for your credit card’s cellphone protection, you must use your credit card to pay for your cellphone service.

Credit card cellphone protection details

Contactless stance
Wells Fargo All Wells Fargo consumer credit cards Up to $600 protection (subject to a $25 deductible and with a maximum benefit limit of $600 per claim and $1,200 per 12-month period), covers damage or theft but does not includes cellphones that are lost.
Barclays
Uber Visa
Coverage up to $600 per claim for damage or theft (after $25 deductible and with a maximum of two claims and $1,200 per 12- month period.
U.S. Bank U.S. Bank Visa Platinum
Coverage is for damage or theft up to $600, with a $25 deductible, for up to two claims ($1,200) per 12-month period.
First  Citizens First Citizens Cash Back Rewards Visa
Coverage up to $500 for stolen or damaged phones (with a $50 deductible and with a maximum of two claims per rolling 12-month period.
Fifth Third Bank
TRIO and Truly Simple credit cards
Up to $200 in supplemental coverage (with a $50 deductible) for damage or theft of eligible cellphonesand $400 per 12-month period.
Chase Ink Business Preferred
Up to $600 per claim in cellphone protection (with a $100 deductible) against covered theft or damage for you and your employees listed on your monthly cellphone bill. Maximum of three claims in a 12-month period.

See related: The best business credit card perks you're probably not using

What’s covered by cellphone insurance?

The Wells Fargo, Uber Visa and First Citizens cards cover cellphone theft and damage, but there are some policy exceptions, with the wording of prohibitions differing slightly based on the card issuer.

These exceptions include:

  • A phone stolen from checked baggage.
  • A phone that “mysteriously” disappeared.
  • Damage caused by normal wear and tear, flooding, an earthquake or radioactive contamination.
  • Damage incurred during “hostilities” such as a “war, invasion, rebellion or insurrection.”
  • Cosmetic damage that doesn’t harm the phone’s functions.

Other cellphone insurance coverage options

Keep in mind that your credit card’s cellphone insurance is supplemental to any existing coverage you may have, such as insurance from a cellphone provider or your homeowner’s or renter’s insurance. (Auto insurance typically doesn’t cover items, such as cellphones, that aren’t actually part of your car.)

So, let’s say your homeowner’s insurance covers the theft of your cellphone. You’d have to file a claim with that insurer first before seeking a payout through the cellphone protection plan from a credit card issuer.

Michael Barry, a spokesman for the Insurance Information Institute, notes that most homeowner’s and renter’s insurance policies carry deductibles of $500 to $1,000, so it might not be worth it to file a cellphone claim through one of those insurers, since the deductible might exceed the value of the phone.

Another option? Cellphone service providers sell insurance that’s comparable to the coverage available as a credit card benefit. However, this insurance costs roughly $70 to $140 a year.

Asurion, a company that backs cellphone insurance offered by AT&T, Sprint and Verizon, says its plans cover cellphone loss, theft or damage, as well as defects that arise after the manufacturer’s warranty expires. The plans also cover cellphone accessories such as chargers and batteries.

"It's certainly better than paying $10 a month over the course of a two-year plan [for insurance] that your phone provider tried to strong-arm you into getting."

Cellphone insurance is ‘a big draw’

Harry Campbell, founder and CEO of TheRideShareGuy.com, a blog and podcast geared toward ride-hailing drivers, says he knows of many drivers who pay for cellphone insurance and likely would benefit from the Uber card’s free insurance, namely because a driver can’t do the job without a cellphone.

“The cellphone insurance is definitely a big draw of the card, as it’s one of the only no-annual-fee cards I know of that offers this benefit,” Campbell says.

It’s worth noting that the new Wells Fargo Propel American Express® Card as well as the Wells Fargo Cash Wise Visa® Card are other no-annual-fee cards offering cellphone insurance.

Should you get a card with cellphone insurance?

Is free cellphone insurance enough of a draw to steer you toward one credit card over another? No.

As Campbell points out, getting cellphone insurance for free is “a nice benefit” of a credit card. Yet the yearly value of this perk easily could be erased if you’re carrying a balance from month to month and paying interest on the debt.

Therefore, it’s wise to let the credit card’s APR (interest rate) guide you toward the right card, as well as the host of other benefits a card offers, rather than zeroing in on a card based solely on whether cellphone insurance is a perk.

See related: 11 hidden credit card perks

"Do you know how many damaged iPhones I could have had replaced through the incentive? Roughly five."

Cellphone insurance: The little-known card benefit

Dakota McKinnon, a PR professional in Las Vegas, has two Wells Fargo consumer credit cards – the Wells Fargo Propel from American Express card and the Wells Fargo Rewards card – but he didn’t know about the cellphone insurance benefit.

Had McKinnon been aware of the insurance perk, he could have taken advantage of it in the past.

“Do you know how many damaged iPhones I could have had replaced through the incentive? Roughly five,” McKinnon says. “I have been using iPhones since 2009, when the iPhone 3G was released.

“If I would have known about this incentive back in my college days, I probably would have been more inclined to use my credit card more advantageously,” he says.

Card cellphone insurance vs. service provider insurance

Like McKinnon, New Jersey actor Scott Churchson says he’d previously had no knowledge of cellphone insurance, except for the coverage available from his cellphone provider.

Churchson says he hasn’t purchased insurance from his provider because he’s turned off by the monthly price tag and the “pushy sales tactics.”

Churchson was pleased to find out that cellphone insurance is one of the benefits of his Wells Fargo Cash Wise Visa card, particularly since he’d have to pay only a $25-per-claim deductible if something happened to his Motorola Droid Turbo 2.

“It’s certainly better than paying $10 a month over the course of a two-year plan [for insurance] that your phone provider tried to strong-arm you into getting,” Churchson says.


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Updated: 11-16-2018