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Better Safe than Sorry: The Benefits of Protecting Electronic Devices

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Why individuals, businesses and schools seeking to save money, recover lost or stolen electronics and foster peace of mind would benefit from purchasing device insurance, extended warranty or protection.

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Better Safe than Sorry: The Benefits of Protecting Electronic Devices

  1. 1. White Paper 2012 Better Safe than Sorry: The Benefits of Protecting Electronic DevicesWhy individuals, businesses and schools seeking to save money, recover lost or stolenelectronics and foster peace of mind would benefit from purchasing device insurance,extended warranty or protection. by Allison Way, Inboun March 13, 2012
  2. 2. Better Safe than Sorry: The Benefits of Protecting Electronic Devices Why individuals, businesses and schools seeking to save money, recover lost or stolen electronics and foster peace of mind would benefit from purchasing device insurance, extended warranty or protection.Executive SummaryThere are few industries that have continued to thrive in Because of the rising electronic dependency as well as thespite of the recession. The obvious ones include the boom in the consumer electronics industry, protectinghealthcare industry and the sin industries (which include damaged, lost and stolen gadgets seems more crucial thanliquor, cigarettes and gambling). But another industry that ever before. The scary reality is that many times, deviceshas not only survived the recession, but has flourished cannot be recovered, they cannot be replaced quickly, andduring it, is that of consumer electronics (CE). they cost a great deal of money to restore. But with a satisfactory protection plan, insurance plan or extendedAccording to the Consumer Electronics Association, the warranty, these scenarios can be avoided.average American Household spent $1,380 over the pastyear on consumer electronics such as HDTVs, cell phones, Nonetheless, users continue to ask themselves:video game systems, computers, portable music devices “Is electronic protection worth it?”and Blu-ray players. Consumer electronics is now a $165 1billion per year industry. “Am I really going to use the protection plan?”Society today relies heavily on electronic devices for “Are my electronics worth the protection?”typical, everyday actions and interactions. Electronic This white paper confirms that device protection is wellgadgets wake users up in the morning, reminds them of worth it, as it provides users with money-savingbirthdays on their calendars and even allows them to opportunities, better electronic recovery options andcheck-in for flights with the touch of a button. In fact, much-needed peace of mind.psychologists and psychiatrists alike have seen such adramatic rise in electronic dependency that terms such as“cell phone obsession” and “obsessive phone disorder”have been coined.1 Mangan, Holly. "How Addiction to Electronics Affects the Environment & OurLives."Money Crashers. SparkCharge Media, LLC, 13 Oct. 2011. Web. 02 Mar. 2012.<http://www.moneycrashers.com/are-we-addicted-to-consumer-electronics/>. ProtectMe Plans | 1
  3. 3. Insurance vs. Extended Warranty vs. Protection PlanMany consumers are unaware that there are options whenit comes to device protection. The most common optionsinclude traditional insurance, extended warranties andprotection plans (also known as service agreements).Traditional InsuranceMany consumers know traditional insurance because it isthe avenue that most take when protecting personalproperty, usually as a rider to a homeowner’s or renter’s A DAY WITHOUT DEVICESpolicy. Traditional insurance covers only expensesresulting from a covered peril (for instance, theft, fires, No alarm clock or mobile phone to wake up to • Silence throughout the house without a TV • Unable to check theflooding, wind and other natural disasters). Traditional weather before leaving the house • Lost in the car without a GPSinsurance will not cover property that has been lost or system • Handwrite all important documents at work • Getmisplaced. In addition, traditional insurance does not info and updates from a local newspaper instead of Twitter •cover mechanical failures, breakdowns or accidental Hand wash all dishes without a dishwasher • Work out in silence without an iPod or MP3 player • No access todamage (unless it has been caused by an insurable peril, as emails/texts/calendarsmentioned above). But most importantly, traditionalinsurance does not offer individual coverage for smaller,portable electronics such as mobile phones, tablets andlaptops.Extended WarrantyOftentimes, consumers look into purchasing extendedwarranties for individual devices. Before purchasing anextended warranty, the consumer must understand that THREE PROTECTION TYPESthis type of coverage only protects against mechanical TYPE LOST & MECH. DAMAGE WATER INDIV.breakdowns or device failures covered under the STOLEN FAILURE DAMAGE COVERAGEmanufacturer’s limited warranty. In other words, an Insurance X* X* X*extended warranty does not cover damaged, lost or stolen Extended X X Warrantyitems. Extended warranties catch the eyes of many Protection X X X X Xconsumers because there are usually no deductibles Planincluded. *only if caused by a covered perilProtection Plans (Service Agreements)A protection plan, also known as a service agreement, hasbeen classified as a combination of both traditionalinsurance and an extended warranty. Protection plansoffer extended warranty coverage without the deductiblesand also cover accidental damage from drops, spills andother unpredicted accidents. Some protection plancompanies, such as ProtectMe Plans, also offer coveragefor water damage. In addition, protection plans offerenhanced coverage to protect against both lost and stolenitems. This type of protection is only provided byindependent third parties rather than by device retailersand is often the most cost-effective option. ProtectMe Plans | 2
  4. 4. Putting a Price on a DeviceThere are consumers who purchase basic cell phones andstandard appliances and refrain from buying any cutting-edge electronics such as tablets, smartphones or laptops.And for those users who are still using flip phones and Saves Money in the Long Runbasic appliances, a protection plan may not be necessary. Users have been asking the same question for years: is itHowever, for the majority of consumers using more worth it to protect my devices? Am I going to spend more 2expensive, sophisticated gadgets , can you really put a money by purchasing a protection plan than replacing myprice on a device? device? Is a protection plan a smart purchase?Devices are made up of much more than sleek, modern These questions are raised for good reason. Protectionhardware and intricate wiring. The software programmed and insurance are solid, but they always come at a price.inside many of today’s devices may be of more value. Just It is up to the user to decide whether that purchase islook at the standard smartphone. These devices hold worth it or not. According to TrackItBack, the world’smore precious material and information than any other; largest lost and found recovery service:contact lists, apps, email, music, GPS systems, notes,calendars, calculators, Internet, pictures, video and much,much more. Therefore, when a smartphone is lost or Mobile phones won’t cost you an arm and a leg whenbroken, all of its precious information is either lost or you are signing a new contract or upgrading. But if youirretrievable as well. Even the most basic mobile phones, want to buy a new phone while on a contract, that cantablets and laptops have the potential of losing valuable start to become expensive. In fact, it will most likely be more than what you paid for it the first time. Andinformation in a matter of minutes. even after you get your new device there are still manyHousehold appliances and electronics are worth more things to do such as re-enter all of your contactthan their price tag to fully replace them as well. information, reprogram your phone, reinstall yourRefrigerators keep food cool, healthy and nutritional. software, and so on.4Televisions entertain and inform. Washers and dryersspare users from the inconvenience of hauling loads of A full-blown protection plan may be the biggest money-clothes to the laundromat. When household appliances saver in the long run. Users who have purchasedbreak, it’s not just the product that is missed—it’s the warranties and extended warranties often find themselvesvalue it adds to an everyday routine. wishing they would have purchased a full protection planThe Benefits of Device Protection because of the increased level of coverage. Warranties and extended warranties do not cover spills, drops andPhones, tablets, laptops, televisions, appliances: they’re all theft that often take a toll on gadgets, and especially onelectronic, therefore, they’re fragile, easily lost and those that are on the move like phones, tablets andsusceptible to theft. Technology is never fail-proof and 5 laptops.downtime is an inevitable and daily risk. According toAsurion, 164,383 cell phones are lost every day. This adds In addition, some insurance companies give users theup to approximately 60 million phones that are lost, stolen opportunity to purchase in bulk and receive discounts. In 3or damaged each year. Lucky for device users, there are fact, on some protection plans, users can save up to 30%options out there for protecting devices (and pocketbooks) more on plans when covering fleets of phones, tablets,from facing these drastic scenarios. laptops or other devices. This option makes the most sense for families, businesses and schools.2 4 Elmer-DeWitt, Philip. "Nielsen: 66% of Americans Ages 24-35 Own a Smartphone."CNN TrackItBack. Technology. Losing Your Cell Phone Can Mean Losing So Much More.PRMoney. CNN, 20 Feb. 2012. Web. 05 Mar. 2012. <http://www.digby.com/mobile- Leap. 19 Oct. 2006. Web. 02 Mar. 2012. <http://www.prleap.com/pr/52253/>. 5industry-resources/mobile-industry-statistics/>. "Is Tablet Insurance All Its Cracked Up To Be?" ProtectMe Plans. Web. 02 Mar. 2012.3 Asurion Homepage. Asurion, 2011. Web. 2 Mar. 2012. <http://www.asurion.com/>. <http://protectmeplans.com/blog/46-is-tablet-insurance-all-its-cracked-up-to-be.html>. ProtectMe Plans | 3
  5. 5. Recovery of Lost or Stolen DevicesAs mentioned above, one of the biggest benefits of deviceprotection or insurance is that they often cover lost and stolen CHECK THE FACTS:items; a feature that warranties and extended warranties do not 96% of the U.S. population uses cell phones.offer. Extended warranties, traditionally sold by retailers, also tendto be more expensive than comprehensive protection plans. The average cost to resolve & replace a phone is $125.According to ProtectMe Plans, 113 cell phones are lost or stolen Miami, FL has the highest rate of lost or stolen phones. 6every minute. FOX News WFLD in Chicago tested this statistic and The top 3 worst places to lose a phone: the swimming pool, amany others when it purposefully lost two cell phones in the busy taxi and the airplane or airport.city in November of 2005. A little over three hours later, the cellphones were returned to their rightful owners. But many device 54% of all smartphone users do not password-protect theirusers do not get so lucky. In a study conducted by Pointsec Mobile phones.Technologies, a mobile-data protection software company in Source: http://thefw.com/lost-cell-phones-infographic/Chicago, it was found that one cab company in Chicago found 387mobile phones, 97 PDAs and Pocket PCs and 20 laptops toward the 7end of 2004.But lost and stolen items do not limit themselves to mobile phones. Thousands of tablets are lost each week in US airports. 8Another 4,425 laptops disappear from Chicago cabs in just six months. The Top 10 Worst Places to Lose a Mobile Phone 100% 80% 60% 40% 20% 0% Lowest Chance of Recovery Highest Chance of Recovery Source: http://thefw.com/lost-cell-phones-infographi6 "ProtectMe Plans." ProtectMePlans. 2011. Web. 02 Mar. 2012. <http://protectmeplans.com/>.7 TrackItBack. Technology. Losing Your Cell Phone Can Mean Losing So Much More.PR Leap. 19 Oct. 2006. Web. 02 Mar. 2012. <http://www.prleap.com/pr/52253/>.8 "ProtectMe Plans." ProtectMePlans. 2011. Web. 02 Mar. 2012. <http://protectmeplans.com/>. ProtectMe Plans | 4
  6. 6. Peace of MindProtection plans, specialty insurance plans and extendedwarranties do not just offer lower rates and bettercoverage; they also provide peace of mind for the enduser. Because many protection plans cover mechanicalfailures, common breakdowns, accidental damage, as wellas lost and stolen items, consumers can use their deviceswithout the daily concerns of cracks, spills and random(and unpredictable) failure.The following is based off of protection plans offered byProtectMe Plans.Mechanical Failure: Mechanical failure and other types ofbreakdowns occurring as the result of the normal use ofthe product are commonly addressed by a manufacturer’swarranty during the first six to 12 months, dependingupon the manufacturer’s warranty period. However,protection plans offer benefits after the manufacturer’s CHECK THE FACTS:warranty period ends. This provides the user with peace ofmind with extended coverage immediately after the 85,600 mobile phones, 21,500 PDAs, andmanufacturer’s warranty expires. 4,425 laptops were left in Chicago’s taxi cabs in the last 6 months of 2004.Accidental Damage: Protection plans also have the ability Source: Pointsec Mobile Technologiesto add accidental damage (or ADH) protection to productsresulting from drops, spills and other accidents that occurduring the normal use of the product. For users who sufferfrom “butterfingers” or are often around liquids such aspools and sinks, an ADH plan is a beneficial option forincreased peace of mind.Lose and Stolen: Finally, as mentioned in the sectionabove, many protection plans offer lost and stolen plans aswell, which can provide ultimate peace of mind for the enduser (see page 3 for more stats and information).ConclusionProtection plans combine the right price, the right servicesand the right peace of mind that users need in order toprotect their devices from failure, drops, spills and breaks..Cutting-edge technology that users depend on dailydeserve cutting-edge protection providing the necessarylevels of coverage to help keep customers calm, cool andcollected if something ever happens to their preciousgadgets. ProtectMe Plans | 5
  7. 7. ReferencesAsurion Homepage. Asurion, 2011. Web. 2 Mar. 2012. <http://www.asurion.com/>.Elmer-DeWitt, Philip. "Nielsen: 66% of Americans Ages 24-35 Own a Smartphone."CNN Money. CNN, 20 Feb. 2012. Web. 05 Mar. 2012. <http://www.digby.com/mobile-industry-resources/mobile-industry-statistics/>."Is Tablet Insurance All Its Cracked Up To Be?" ProtectMe Plans. Web. 02 Mar. 2012. <http://protectmeplans.com/blog/46-is tablet-insurance-all-its-cracked-up-to-be.html>.Mangan, Holly. "How Addiction to Electronics Affects the Environment & Our Lives."Money Crashers. SparkCharge Media, LLC, 13 Oct. 2011. Web. 02 Mar. 2012. <http://www.moneycrashers.com/are-we-addicted-to-consumer-electronics/>."ProtectMe Plans." ProtectMePlans. 2011. Web. 02 Mar. 2012. <http://protectmeplans.com/>.TrackItBack. Technology. Losing Your Cell Phone Can Mean Losing So Much More.PR Leap. 19 Oct. 2006. Web. 02 Mar. 2012. <http://www.prleap.com/pr/52253/>.Wright, Shauna. "The 10 Cities Youre Most Likely to Lose Your Cell Phone in and More Surprising Missing-Mobile Facts." TheFW. 15 July 2011. Web. 02 Mar. 2012. <http://thefw.com/lost-cell-phones-infographic/>. ProtectMe Plans | 6
  8. 8. About MobileMotiveMobileMotive LLC is a trusted extended warranty provider that specializes in simplifying and streamlining product protectionplans for popular consumer electronics and appliance purchases. Through our flagship product ProtectMe®, we deliver superiorcustomer service, noticeable value and specialized technical support for shoppers nationwide, freeing retailers and dealers tofocus on their core business operations.A customer-focused company, MobileMotive offers a broad range of standard and optional product warranty solutions. Westep in where most programs stop, delivering superior protection for both new and used or refurbished devices. Byconcentrating our business efforts solely on extended warranty and protection products, were proud to offer highlycompetitive pricing, broader coverage, lower deductibles and extremely responsive claims processing.As an independent and impartial partner, MobileMotive is proud to offer its flagship product ProtectMe® to provideconsumers, businesses and schools with confidence and security that claims will be covered even in the unfortunate event ofretailer or manufacturer failure. Consumers can shop with renewed confidence knowing their protection plan is firmly backedand underwritten by a reliable insurance policy.We believe customer service excellence begins with enthusiastic and motivated associates. Thats why we promote a corporateculture built on solid performance incentives, team collaboration, superior benefits and compensation packages. Based justoutside of Kansas City in Overland Park, Kansas, MobileMotive incorporates a full staff of professionals dedicated to providingtop-notch products and customer service. ProtectMe Plans | 1.800.504.7814 | www.protectmeplans.com

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