Earlier this morning I was reading an analytical piece by Esther Stein, where she argued that the time is ripe for phone and tablet insurers to flourish. The main argument was that with the increase of smartphone and tablet PC sales, consumers are at an increased risk of getting their devices being stolen or damaged. And, the costs of replacing those devices are pretty high. Hence, it is high time consumers will start to consider purchasing insurance for their devices. But, would it really happen?
The projected tablet sales of 2012 are 118.9 million units, almost double the amount sold last year. The smartphone market isn’t slowing down either. With the increase of powerful devices being built in a pocket friendly form factor, we can expect to see most of these devices taking their place in people’s pockets or purses. And, this trend increases the chances of damages from accidental drops of these devices.
Insurers hope, as smartphones and tablets are mostly sold through contracts and these are costly to replace, consumers would opt out for device insurance policies. But, aren’t they over optimistic?
Let’s look at the success of device insurers. Some of the known names in this market are Protect Your Bubble, SquareTrade and Global Warranty Group. None of the insurers have disclosed their sales figures, but Stephen Ebbett, president of Protect Your Bubble, said that the numbers encompass “many thousands.” Not a big number considering 1.8 billion mobile shipments and 118.9 million tablet shipments in 2012.Means, consumers are by large not interested.
However, I am not ruling out the research reports that show positive trend towards phone and tablet insurance adoption. But, I just can’t imagine myself buying insurance for my phone or tablet. Instead, an extended warranty option, usually offered by laptop vendors, seems to be a better option.
What do you think? Share your comments on this issue.
Thanks to: Byte