This article has been updated from a previous version.
A few years ago, you probably wouldn’t have heard too much about insuring your cell phone. But as the cost of smartphones has increased, many people are now looking for ways to protect their devices. Fortunately, credit card providers have recognized that mobile device insurance is something consumers are interested in.
Mobile device insurance will cover you in the event that your phone is lost, stolen, or damaged, but you won’t necessarily be reimbursed for the full amount you paid for the device. There’s depreciation to consider and a deductible to pay, which is why you need to understand what mobile device insurance covers you for how to make a claim and which credit cards offer this product
What you’re covered for
Currently, mobile device insurance covers you only up to a maximum value of $1,000. And, to be eligible, you need to pay for the device with a credit card that offers mobile device insurance. If your device is subsidized by your carrier (meaning you paid $0 upfront and are on a plan), then you need to pay your monthly cell phone bill with that credit card.
It’s important to note, too, that your mobile device insurance also doesn’t kick in right away. Your coverage takes effect after a certain number of days from the purchase date or after a certain number of billing cycles (whichever comes first). For example, your policy might state that your insurance applies from the later of 90 days from the date you purchased your mobile device or after your second billing cycle.
How to make a claim
When you make a mobile device insurance claim, you will need to pay a deductible. The deductible is based on either the purchase price of your phone or a set percentage e.g. it could be $25-100 or 10%. The amount you’ll pay depends on the credit card you’re using, which we’ll go over shortly.
As well, your phone will have depreciated since you first bought it (generally speaking, a phone’s value depreciates by about 2% every month), so the total depreciation amount will also be subtracted from the purchase price, and this will determine the final payout.
It’s important to read the details of your mobile device insurance. In some cases, you’re only allowed to make a certain number of claims in a set period of time. There are also limitations and exclusions to claims, such as batteries, used devices, and devices used for commercial purposes.
To make a claim, you need to let your cell phone provider know about the loss within 48 hours. If your phone was stolen, you’ll also need to file a police report within seven days. You’ll want to notify your insurer (credit card provider) right away when making a claim but you usually have up to 14 days to do so.
If mobile device insurance is important to you, you’ll want to take a look at the following credit cards that boast this feature:
The Meridian Visa Infinite Cash Back Card was the first Canadian credit card to introduce mobile device insurance and was likely the catalyst for other credit cards starting to add it as a standard benefit.
With the Meridian Visa Infinite Cash Back Card, your insurance kicks in the later of 90 days from the date you purchased your mobile device or when your second monthly wireless bill is charged to your account.
Depreciation is set at 2% per month for each completed month of service from the date you purchased your phone. The deductible is determined on a sliding scale based on how much you paid for your device less any taxes.
|Purchase price||Deductible amount|
So, let’s say your phone cost you $700 before tax and you’d had it for eight months when it got stolen. Your depreciation would be $112(2% X 8 months X $700) and your deductible would be $100 so you would be paid out $488 ($700 - $112 - $100).
You can read the Meridian Visa Infinite Cash Back Card insurance policy here.
The Scotia Momentum Visa Infinite Card recently went through some changes and added mobile device insurance as a standard benefit. What makes this card stand out from the rest on this list is the insurance kicks in after just 30 days from the date of purchase or when the first monthly statement is billed to your account.
The deductible and depreciation figures on this card are exactly the same as the Meridian Visa Infinite Cash Back Card so you can use the above chart for reference. The maximum value you can claim is $1,000.
You can read the Scotia Momentum Visa Infinite Card insurance policy here.
Like the above two cards, CIBC Aventura’s mobile device insurance has a maximum value of $1,000 but the deductible is determined a bit differently. Your deductible is based on 10% of the value of your phone after factoring in the 2% per month depreciation.
For example, if your phone cost you $900 before tax and you make a claim 10 months after you purchased it, here’s how your payout would break down:
$900 - $180 depreciation (2% X 10 months X $900) = $720. That’s what your phone is worth post-depreciation. So, you take 10% of $720 to get your deductible of $72.
$900 - $180 - $72, and you’d get paid out $648.
The Tangerine World Mastercard provides mobile device insurance on new cell phones, smartphones or tablets for up to $1,000. The coverage kicks in 30 days after you purchase the device and protects you if it gets stolen, accidentally damaged, is lost, or if it suffers from a mechancial breakdown. Coverage is only active if you buy the phone on your Tangerine World Mastercard or if you make monthly payments on it using the card. And, exactly like the Meridian Visa Infinite Cash Back Card, the deductible starts at $25 for phones worth $0 to $200 (less taxes), and increases up to $100 for phones worth $600.01 or more. Depreciation is set at 2% a month.
A recent addition to the fleet of credit cards offering mobile device insurance, the TD Aeroplan Visa Infinite Card now offers up to $1,000 of coverage for your mobile device. In order to qualify for coverage, you must have charged at least 75% of the total cost of the device to your TD Aeroplan Visa Infinite card, or be using it to make monthly payments toward your device. Coverage kicks in 30 days from the purchase date and and depreciation is set at 2%.
According to TD's policy, if you give a cell phone as a gift (and pay for it with your TD Aeroplan card), it's still eligible for mobile device insrance coverage but it has to be you — not the recipient — who makes the claim in order to get the benefits.
Offering the highest amount of coverage on this list is the RBC Avion Visa Infinite card, which tops out at $1,500 for mobile device insurance. That said, coverage kicks in much later than any other card on this list, at 91 days from the purchase date. You can also only make one claim in a 12-month period, and two claims in a four-year period. Depreciation is set at 2% each month, and the deductible amount is 10% of the phone's depreciated value.
You can read the RBC Avion Visa Infinite insurance policy here.
The National Bank MyCredit Mastercard's mobile device insurance activates after 60 days from the purchase date, and provides coverage on your mobile device for up to $1,000. Coverage lasts for up to two years from the date you buy the device. The deductible on this policy is the same as the Meridian Visa Infinite Cash Back Card (see chart above) but the depreciation is calculated at 3% a month, making this the highest depreciation percentage on this list. This means you could be in for a more expensive claim.
From Desjardins, the Odyssey World Elite Mastercard provides mobile device insurance up to $1,000. Like many of the other cards on this list, coverage takes effect 30 days after you buy your device, or the date your first monthly payment for the device is charged to the credit card. Depreciation is set at 2% a month and the deductible thresholds are exactly the same as the Meridian Visa Infinite Cash Back card above.
You can read the Odyssey World Elite Mastercard insurance policy here.