When customers have three or four $600 smartphones on their family plans, purchasing insurance for all of them can prove costly.

Most cell phone companies offer insurance plans that often carry expensive monthly premiums and high deductibles, but many also cover the loss or theft of a phone. With independent insurers including Squaretrade taking a bite out of their business, large carriers have been forced to respond with improved plans of their own.

Last week, AT&T quietly launched a new Multi-Device Protection Pack ($30/month) that covers up to three devices (including phones, tablets, laptops) against loss, theft, damage, or out of warranty defects for as long as customers stay enrolled in the plan. The primary limitation: the device must run Windows Vista, OSX, Android or iOS or newer operating systems. Customers can add their two additional devices at any time the insurance is in effect. Asurion provides the coverage and warranty service.

Squaretrade says it offers better value than traditional cell company insurance plans.

AT&T’s $30 a month price tag will seem high when compared against competing offers from Squaretrade running as low as $5 a month per device for up to three years, but AT&T argues its insurance plan covers loss or theft, while Squaretrade does not.

Squaretrade responds that it doesn’t believe loss/theft protection is a good value for its customers.

“Research has shown that people are 10 times more likely to have their phone break due to malfunctions or accidents like drops and spills (which SquareTrade covers better than anyone else) than lose it or have it stolen,” Squaretrade argues. “And yet, loss & theft coverage can cost twice as much as accident protection. Meanwhile, there are free apps to help find your phone if you ever do misplace it.”

Customers who find themselves needing to file a claim will find significant differences between AT&T’s plan and competitors like Squaretrade.

Both charge deductibles, but AT&T’s drops the longer you don’t file a claim. Squaretrade charges a flat $75 deductible after returning your damaged device in a postage-paid box. Many Squaretrade customers report they typically receive reimbursement — not a repaired phone — for the full retail (no-contract) value of the phone, minus the deductible. Most cell company insurance plans send customers a previously refurbished phone of the same or better model.

AT&T’s declining deductible varies depending on the device. For the first six consecutive months without a claim, AT&T charges these deductibles:

• Devices connected to AT&T’s network (phones, 4G-enabled tablets, etc.): $50/125/199 depending on device model;
• Approved repair of a laptop or tablet: $89;
• Replacement of lost/stolen/non-repairable laptop or tablet: $199

After the first six months but less than one year with no claims, customers get a 25% discount on their deductible. After 12 months, the discount increases to almost 50%. There is a limit of six shared claims between all three devices within any consecutive 12-month period with a maximum replacement value of $1,500 per claim. There is a 30-day waiting period before AT&T starts coverage of non-connected devices (laptops, etc.).

AT&T also provides technical support for customers via phone or online chat to set up and back up devices and deal with basic troubleshooting.

There are some devices AT&T won’t cover:

• Galaxy Camera (EK-GC100A)
• Blackberry Playbook
• Phones on GoPhone® accounts
• Tablets with pre-paid data plans
• PlayStation® Vita
• AT&T 3G MicroCell
• Phone or device models not sold by AT&T (e.g., Dell Streak, Google Nexus One, TerreStar Genus)
• Docks (such as for the Motorola ATRIX 4G)
• Amazon Kindle

A complete list of covered devices is available from AT&T’s website and is subject to change.

[flv]http://www.phillipdampier.com/video/ATT Cell Phone Insurance – Multi-Device Insurance Protection from ATT 5-23-14.flv[/flv]

AT&T explains its new Multi-Device Protection Pack, priced at $30 a month, covering up to three devices. (1:35)

If you thought AT&T Mobile Insurance would bring you peace of mind if your expensive smartphone is ever lost, stolen, or damaged, think again.

The wireless carrier and its partner Asurion have nine pages of sneaky terms and conditions that give the two companies a myriad of reasons to deny insurance claims and leave you with nothing after paying your $6.99 monthly insurance premium.

The Los Angeles Times reports one customer – Marianna Yarovskaya – learned this the hard way when she purchased AT&T’s insurance to cover her new iPhone 5S she bought before taking a trip to Indonesia. Sure enough, her new phone was swiped right out of her hotel room. Yarovskaya’s disappointment only got worse when her insurance claim was denied not once, or twice, but three times.

An Asurion representative explained to Yarovskaya her insurance claim was rejected because she was outside of AT&T’s network when she completed the last steps of her online registration for AT&T’s insurance. It turned out AT&T Insurance is worthless if customers enroll while using a Wi-Fi connection or any other service provider other than AT&T’s wireless data network.

“This is crazy,” Yarovskaya said. “They are saying that if you travel, the insurance becomes worthless.”

A careful review of the nine pages of barely penetrable terms and conditions unearthed the “tricks and traps” Asurion used to walk away from Yarovskaya’s claim.

On page six, AT&T and Asurion insist that “covered property must be actively registered on the service provider’s network on the date of loss and have logged airtime prior to the date of loss.”

To ordinary people, that would suggest that Yarovskaya would be covered as soon as she purchased and activated her new AT&T iPhone and service while in a Los Angeles AT&T store. That act left her “actively registered” as an AT&T customer. Asurion also specifies their insurance coverage territory is “worldwide,” which would indicate insured phones are covered wherever they are lost, stolen, or damaged.

But then there is pesky page eight — the “definitions” page, where Asurion gets to define the meaning of various English words and phrases as it sees fit.

Asurion’s definition of “covered property” is a device “actively registered on the service provider’s network and for which airtime has been logged after enrollment.”

When the Times asked Bettie Colombo, an Asurian spokeswoman, what that meant, she explained phones are not insured until the customer performs some wireless activity on AT&T’s network after signing up for coverage.

Translation: You have to do something on your carrier’s wireless network after coverage begins for coverage to begin.

If you are roaming, traveling overseas, or you use your phone with Wi-Fi and AT&T doesn’t see the device on its network after signing up for insurance, you are not covered. The language is so broad, it could also be interpreted to mean you have to be actively registered on an AT&T cell tower at the time of loss or damage or Asurion could walk away for that reason as well.

An insurance underwriter tells Stop the Cap! the real intent of this clause is to protect Asurion from customers signing up for insurance -after- losing or damaging their phone and then immediately filing an insurance claim. As a protection measure, the insurer wants to confirm it is insuring a working phone actually possessed by the owner before activating coverage. If customers registered for insurance on other devices or networks, AT&T wouldn’t have direct, absolute confirmation the customer is insuring a working phone. But most customers are unaware of this requirement, and if a claim arrives shortly after a customer signs up for coverage, insurance adjusters tend to be extra suspicious.

AT&T is staying out of the insurance dispute and declined to comment, leaving Yarovskaya with a $6.99 premium payment and $650 in replacement costs to buy a new phone.

The Times‘ opinion about the merits of AT&T’s insurance? “Buy it at your own peril.”

[flv]http://www.phillipdampier.com/video/ATT Mobile Insurance phone service 3-4-14.flv[/flv]

AT&T makes it look easy to sign up for device insurance, but navigating through the claims process and nine pages of terms and conditions leave a lot of room to deny your claim. (2:02)

Verizon Wireless today introduced HomeFusion Broadband: a new service that provides high-speed in-home Internet access using the company’s 4G LTE wireless network.

Designed primarily to reach households with limited broadband options, HomeFusion will deliver download speeds of 5-12Mbps and upload speeds of 2-5Mbps. While installation will come free of charge, a one-time equipment charge of $199.99 applies.  Pricing is nearly identical to Verizon’s mobile broadband service:

• Up to 10GB — $60/month
• Up to 20GB — $90/ month
• Up to 30GB — $120/month
• Overlimit fee: $10/GB

Verizon's 4G LTE antenna must be mounted on an outside wall of your home to assure good reception. (Picture: The Verge)

Verizon says HomeFusion is their broadband answer for rural America.

“HomeFusion Broadband is just one of the new products and services that is made possible with our 4G LTE network,” said Tami Erwin, vice president and chief marketing officer, Verizon Wireless. “Customers want to connect more and more devices in their homes to the Internet, and HomeFusion Broadband gives them a simple, fast and effective way to bring the most advanced wireless connection from Verizon into their homes.”

A third party company, Asurion, will handle installation of Verizon’s cylinder-shaped antenna, installed on the side of a customer’s home.  The antenna is designed to pick up the best possible signal from Verizon’s growing 4G network.  The antenna transmits the signal to a company supplied router capable of connecting up to four wired and 20 wireless devices.

HomeFusion Broadband will be available beginning later this month in Birmingham, Ala., Dallas and Nashville, Tenn., with additional markets to follow.

Verizon’s product is unlikely to attract substantial interest in more populated areas where a 10GB monthly usage cap would prove unacceptable in many homes where multimedia content is a growing part of the Internet experience.  But is could compete with satellite broadband, which also has low monthly usage caps.  Verizon may also win back customers in service areas it sold to independent providers like FairPoint and Frontier Communications, which have since saddled most of their rural customers with 1-3Mbps DSL service.  But Verizon’s pricing puts rural America at a usage disadvantage because of the low monthly limits and higher price tag.

The development of HomeFusion could reduce Verizon’s investment and interest in further expanding its traditional rural broadband product — DSL.  But Verizon will have to expand its still-urban focused LTE 4G network further into the countryside for HomeFusion to serve its intended market.

AT&T wants to sell its iPhone customers an overpriced insurance plan to cover damaged or lost phones.

Offered by mobile phone insurer Asurion, AT&T’s MobileProtect policy will be priced at $13.99 per month, with a steep deductible — $99 for an 8GB iPhone 3G to $199 for a 32GB iPhone 3GS.  If you lose or damage your phone, Asurion will repair or replace it with a refurbished equivalent or better iPhone model (their choice).

At those prices, iPhone insurance (and collectively most cell phone insurance plans) do not represent a good deal for consumers for several reasons:

1. The upfront cost is very high in relation to the value of the phone.  Over a typical two-year AT&T contract, Asurion will collect $335.76 to insure a $700 phone;
2. Asurion’s very high deductible reduces the company’s payout exposure by up to $200.  Assuming you break your phone in the last month of a two year contract, Asurion will have $535 of your money to work with, making their cost to replace the phone just $164.
3. Asurion does not guarantee customers will get a brand new iPhone.  Replacing a lost or broken iPhone with a refurbished model can significantly reduce Asurion’s costs and leave you with a questionable replacement;
4. The deal does not extend to current iPhone owners who have older phones that statistically would likely generate a higher percentage of claims.  In fact, customers will have to purchase coverage within 30 days of purchasing a brand new iPhone, giving Asurion the likelihood mechanical problems will be handled by Apple’s traditional warranty, reducing the insurer’s exposure to expensive claims.

There are a number of alternatives.  First, protect your phone with a suitable case or cover — scratches and impact damage are among the most common issues afflicting iPhones.  A few may afford some protection from water damage if the phone gets slightly wet, although a dunk in a pool or deep puddle is probably going to present a challenge for any case or covering.

Second, consider alternative insurance from companies like Squaretrade.  The company’s iPhone insurance costs $8 per month for 24 months, or $96 paid in full for an iPhone 3G. For a 32GB iPhone 3GS, it’s $9.99 per month, or $144 for 24 months of coverage.  Accidental damage claims have a $50 deductible.  But Squaretrade can cost even less when you take advantage of regular discount codes that provide up to 40 percent off.  Just do a Google search for Squaretrade coupons and discount codes, especially around holidays.  You have up to 90 days after purchasing your iPhone to buy Squaretrade coverage.

Squaretrade does not cover loss or theft, however.  You should check with your insurance agent for a personal property policy.  Most offer coverage for personal cell phone loss or theft for under $40 per year.  Many are sold as standalone policies that do not carry a traditional deductible commonly found on homeowner’s policies.  Better yet, making a claim under many of these types of policies generally will not impact your homeowner’s insurance policy, an important consideration when your claims history can impact your renewal rate.  Ask your insurance agent for details about what their cell phone insurance policies cover and what impact any claims might have on your other policies with the company (and their renewal rates.)  Many insurers will sell these policies on a standalone basis to customers who do no other business with the insurer, so shop around.

If your iPhone goes missing, virtually all insurers require a police report and most will either mail you a brand new iPhone or reimburse you for the purchase of an identical new phone you buy yourself at the non-subsidized price.

If none of these ideas appeal to you, consider establishing a savings account and deposit $14 a month into it, specifically to cover a portion of your costs to replace your iPhone if it is damaged or lost.  Although it won’t cover the full cost of the replacement, that $14 a month will always be your money.  If nothing goes wrong and you keep your phone in good condition over 24 months, that $335+ in accumulated savings is yours to keep.  That’s a better deal than giving it to Asurion.

[flv width=”512″ height=”308″]http://www.phillipdampier.com/video/KTVI St Louis Cell Phone In Water 5-26-10.flv[/flv]

KTVI in St. Louis ran this silly segment about what you can do if your cell phone takes an involuntary dip in the pool.  (3 minutes)