SquareTrade informed PhoneNews.com this week that they are no longer permitting iPhone 3G (and new iPhone 3GS) customers to purchase warranties that cover the full retail price. PhoneNews.com initiated this investigation after noting subtle changes in the iPhone purchasing page.
SquareTrade going forward will only honor the two-year contract replacement amount. Meaning, a customer that purchases iPhone 3G/3GS for the full retail price, will only receive a plan good for partial coverage. SquareTrade defended this action, citing the difficulty in sourcing replacement parts for iPhone units, as well as other unspecified higher costs.
The company has said that they will work with customers who followed their older workaround, which enabled higher coverage values to be purchased, matching the full retail price. However, customers have reported that the best offer that they have received, is a partial refund, downgrading to the standard iPhone protection. On the margin, paying for the higher coverage amount was cheaper than the standard iPhone plan, thus leaving some customers asking for alternatives.
SquareTrade has been criticized by many for offering “custom purchasing pages” that insert pre-set values, often which do not match the actual or replacement retail price. For example, when selecting “cell phone” from the instant quote page, a $399.99 value is instantly inserted… without any option to enter the true retail price. No word at this time on if SquareTrade is enforcing this policy change on their other custom purchasing pages.
AT&T continues to refuse to offer their Asurion-based insurance policy for any iPhone. This comes as Best Buy now offers accidental damage coverage for iPhone purchases, as well as carrier insurance being offered on competing devices, including Verizon’s Samsung Omnia, Sprint’s Palm Pre, and T-Mobile’s G1 and G2.
6 responses to “SquareTrade Changes Tune: iPhone Full Retail Price no Longer Coverable”
“citing the difficulty in sourcing replacement parts”
I have successfully repaired several 2g and 3g units using parts readily available from a few sources, including eBay. I do understand the warranty implications regarding the use of possibly non OEM parts, but still, if I can do it…..
If you are a homeowner, contact your insurance company (I use State Farm). I paid $40 (1 year coverage) for a rider that covers my iphone from damage and if it is lost/stolen. Granted if your phone is severely damaged, they’ll likely give you enough money to get a new phone and not fix the one you have. They are not in the repair business and don’t have repair centers to do it. According to my insurance agent, State Farm realizes that people have high-end devices that are not covered by homeowner’s insurance and therefore are providing this additional service.
I’m not promoting State Farm, simply call your agent and see what’s available.
Guillermo, we’re familiar with the State Farm plan here. While it is a good initial plan, we have heard numerous reports that filing even one claim, will result in a huge deductible being added to the policy.
And, State Farm appears to consider one claim against any personal possession to pose a risk to the rest… so a claim on your iPhone, could wind up with a deductible attached to your laptop policy as well. So, my advice there would be to save your homeowner/renters insurance add-on policies for truly big-ticket items, like that shiny new MacBook Pro you’re thinking of buying.
Christopher, thanks for the heads up on this. I haven’t had to file a claim and probably won’t so I can save my coverage for higher end, more expensive equipment. Not looking good for iPhone owners, maybe it’s time I look at a Blackberry device!
From what I heard it’s Asurion who won’t cover the iPhone not AT&T. Too high a risk or something..
While that is somewhat correct, Asurion is trying to work with carriers. Sprint for example raised their deductible to $125 on Smart Devices, in order to support the Palm Pre.
AT&T appears to want to keep deductibles low, and not offer a separate tier for iPhone. That appears to be more of a limitation of AT&T’s billing system than anything else (much like MMS and Tethering support on iPhone).