You buy a smart phone, a tablet or a laptop. The sales person asks, “Do you want an extended warranty with that?” Just say no.
Most of the time that is the right answer. Here is the idea of one expert: “Every time someone offers to sell you insurance on a non-large purchase say no. Take that money and put it into a rainy-day account. With any luck, there will be plenty of money in that account the next time you drop your iPhone.” Another one says to take the money and buy a good protective case.
It is all about the arithmetic. First, there is the cost of the warranty. Then, if you try to use the warranty, there is likely to be a deductible before the insurance pays off.
A cracked phone screen happens the most. Take the Apple iPhone as an example. You can walk into an Apple store or repair center and have an iPhone 6 screen fixed for $109. You might have to wait, but you have not paid the $99 warranty cost.
With AppleCare+, even after you pay the $99 up front, Apple gets a deductible of $79 to fix broken screens. Your total out-of-pocket for a broken screen expense is $178.
Your credit card may have a feature that extends the manufacturer’s warranty by one or two years. Look into it.
If you break your phone often, you should shop for warranties. iCracked and SquareTrade have decent deals. An expert said, buying a warranty is a luxury not a necessity.
Source: The Wall Street Journal December 9, 2015