Credit card mobile device insurance: How it works and which cards in Canada have it

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by Ratehub.ca October 19, 2020 / No Comments

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If someone were to ask you what the most important object you own is, and you replied anything other than “my smart phone” you’d probably be lying. They’re central to the way we live; always on, always within reach, always being scrolled through. They’re how we connect and how we work. So, isn’t it a pain-in-the-you-know-what when they break?

Yeah, it’s a huge pain in your wallet when that happens.

Thankfully, there are insurance options available to help you replace your device when disaster strikes.


Overview: Credit card mobile device insurance

Still a relatively niche option for covering your cell phone against damage or loss, a handful of Canada’s best credit cards now include up to $1,000 in mobile device insurance as a built-in benefit.

What’s particularly great about credit card mobile insurance is it doesn’t require any additional ongoing or upfront payments, which means you won’t owe anything if you don’t end up using it. That’s in sharp contrast to most other cell phone insurance options which require you to pay whether or not you actually take advantage of their coverage.

Enrolling for coverage is also simple: As long as you purchase the device (or pay for the monthly contract) on the credit card, you’re automatically covered in the event your device is lost, stolen, or accidentally damaged.

Of course, there are some terms and conditions that you’ll need to account for:

  • Along with the aforementioned caveat that the device (or its monthly contract) must be purchased on the card that offers the insurance, coverage doesn’t apply instantly. It typically kicks in within 30-90 days. Reimbursement amounts are also typically capped up to a maximum of $1,000.
  • You’ll have to factor for a deductible when making a cell phone damage claim. The deductible amount does vary depending on the cell phone’s MSRP, but generally, it’ll be around a $75 deductible for phones between $400-$600 and a $100 deductible for phones $600 or more.
  • Coverage typically lasts for up to a maximum of two years from when you purchased your phone.
  • The phone can’t be used, previously owned, refurbished, or modified.
  • Batteries and cell phone accessories aren’t covered.
  • Coverage will take into account the depreciation of your device, which is usually estimated at around 2% per month of ownership.
  • If your cell phone is stolen from your baggage, mobile device insurance will only kick in if the baggage in question is “hand carried” and was in your possession at the time of the theft.
  • You’ll be limited to making a maximum of one claim within a 12 consecutive month period.
  • In the case your phone is lost or stolen, you’ll need to notify your phone provider and suspend wireless services to the device within 48 hours.
  • When replacing a phone, the make and model must be the same (or the closest equivalent) as your original device.

Even when considering all of the above, credit card mobile device coverage will likely cost you much less than the other phone insurance options out there. Plus, as mentioned before, the real advantage is you won’t have to make any regular monthly payments for the added coverage, and will only need to factor for a deductible when making a claim.


Example: How a mobile device reimbursement is calculated

For a deeper look into how credit card mobile device insurance works, let’s walk through an example using the Tangerine World Mastercard, arguably one of the best cash back credit cards on the market that also comes with $1,000 in mobile device insurance.

Let’s say you:

  • Bought an $800 phone on your Tangerine World Mastercard on May 1.
  • Then, come eight months later on January 21 of the next year, you submit a claim.

Here’s how your reimbursement amount would be calculated:

Cell phone price $800

(MSRP + applicable taxes)
Depreciated value

Card issuers assume the value of your phone depreciates by 2% every month you own it.
$128

(2% x $800 x 8 months)
Phone’s price after depreciation $672

($800 – $128)
Cost of deductible

Tangerine requires a $100 deductible for phones with an MSRP of over $600.
$100

Maximum reimbursement amount

The value after subtracting the monthly depreciation and deductible.
$572

($672 – $100)

Credit cards in Canada with mobile device insurance

There are a handful of cards that offer mobile device insurance, each of which differs in slight ways. Below are some of our top recommendations.

Tangerine World Mastercard

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 30 days from the date of your phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: $100 for devices with an MSRP of $600+ (or a deductible of $75 for devices with an MSRP of $400-$600)
  • No annual fee
  • Earn 2% cash back on purchases in up to three bonus categories, and 0.5% on all other purchases

Released in November 2019, the Tangerine World Mastercard is the latest credit card currently available to offer complimentary mobile device insurance – making it one of the few no fee cards to do so.

The flexible rewards card lets you earn a strong 2% cash back on select bonus categories, and unlike most cards, you won’t be locked into particular categories but can choose your own. You can pick up to three bonus categories out of a total of ten options that includes everything from groceries and gas to recurring bills (like your monthly smartphone plan).


National Bank MyCredit Mastercard

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 60 days from the date of your phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 3% per month
  • Deductible amount: $100 for devices with an MSRP of $600+ (or a deductible of $75 for devices with an MSRP of $400-$600)
  • No annual fee
  • Earn 1% cash back on restaurants and preauthorized payments, and 0.5% on everything else

One of just two no fee credit cards on our list (and the only card with no specific income requirements), the National Bank MyCredit Mastercard is arguably the most accessible card to offer mobile device insurance. That said, it does come with a compromise. This card assumes the value of your device depreciates by 3% monthly not 2% like most credit card mobile device policies, which could end up decreasing your total claim amount by a few dozen dollars.


CIBC Aventura Visa Infinite

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 90 days of phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: 10% of the phone’s depreciated value (phone’s MSRP after the monthly depreciation) or the cost of repair

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  • Annual fee: $120
  • Earn 2 points per $1 on travel, 1.5 points on gas, groceries and pharmacies, and 1 point per $1 on all other purchases
  • Free Priority Pass membership and full rebate on NEXUS
  • 4 complimentary visits per year to Priority Pass airport lounges

On top of offering mobile device insurance, the CIBC Aventura Visa Infinite is equipped with frills like complimentary access to airport lounges (free Priority Pass membership with four annual passes) and NEXUS application rebates ideal for cardholders who frequently travel south of the border.

In terms of its mobile device insurance, this card’s coverage will only begin 90 days after you purchase the device – not 30 days like on the aforementioned Tangerine World Mastercard.


Scotiabank Momentum Visa Infinite

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 30 days from the date of your phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: $100 for devices with an MSRP of $600+ (or a deductible of $75 for devices with an MSRP of $400-$600)
  • Annual fee: $120 (waived for first year)
  • Earn 4% cash back on groceries and recurring bills
  • Earn 2% cash back on gas and daily transit
  • Get 1% cash back on all other purchases
  • Receive VISA Infinite benefits

Along with the card’s great rewards on groceries, gas, and transit, the Scotiabank Momentum Visa Infinite offers 4% cash back on recurring bills. So, if you set up your cell phone plan to automatically charge your card every month, you’ll earn 4% back on your bill in addition to cell phone coverage.


Meridian Visa Infinite Cash Back Card

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 90 days from the date of your phone purchase or the second consecutive bill payment is charged (whichever comes later)
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: $100 for devices with an MSRP of $600+ (or a deductible of $75 for devices with an MSRP of $400-$600)
  • Annual fee: $99
  • Earn 4% cash back on gas and groceries
  • 2% cash back on drug store purchases and recurring bill payments
  • 1% cash back on all other purchases
  • Emergency travel and mobile device insurance

The Meridian Visa Infinite Cash Back is one of the top credit cards for insurance in the market. In addition to mobile device insurance, this card comes with travel medical coverage of $5 million for 48 days, which is well above the standard $1 million for 21 days. Plus, its travel benefits extends to seniors up to 75 years old.

The fact it has recurring bills as a bonus category means you can pocket 2% cash back instead of the standard 1% on your monthly cell phone bill provided you set it so the payment automatically charges the card every month.

The one drawback of the card is its mobile device coverage will only start 90 days after the purchase date.

It’s worth noting the credit union’s mid-tier cash back card – the Meridian Visa Platinum Cash Back – also comes with mobile device insurance, though it does offer fewer rewards on everyday spending (2% on gas, groceries, pharmacy purchases, and bill payments, and 1% on everything else for a $50 annual fee).


TD Aeroplan Visa Infinite (starting November 8)

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 30 days of phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: $100 for devices with an MSRP of $600+ (or a deductible of $75 for devices with an MSRP of $400-$600)

Effective November 8

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  • Annual fee: $139
  • Earn 1.5 points per $1 on travel from Air Canada; gas, groceries and pharmacies; and 1 point per $1 on all other purchases
  • NEXUS reimbursement and Air Canada benefits

On November 8th, Aeroplan’s complete roster of co-branded credit cards from TD and CIBC will undergo an overhaul with most receiving mobile device insurance as a completely new benefit.

The most popular Aeroplan credit card – the TD Aeroplan Visa Infinite – will receive the standard $1,000 in coverage in the event your mobile device is damaged, stolen, or lost. Additionally, the revamped card will offer new benefits like free first-checked in bags for you and up to eight travel companions (which can save you around $30 in fees per traveller for flights within North America), along with free NEXUS membership reimbursements, hotel/motel burglary insurance, and preferred pricing when redeeming Aeroplan points for flights on Air Canada.

Below, we’ve provided a breakdown of mobile coverage amounts coming to Aeroplan credit cards effective November 8.

Credit card Annual fee Mobile device insurance
TD Aeroplan Visa Platinum Card $89 Up to $1,000
TD Aeroplan Visa Infinite Card $139 Up to $1,000
CIBC Aeroplan Visa Infinite Card $139 Up to $1,000
TD Aeroplan Visa Infinite Privilege $599 Up to $1,500
CIBC Aeroplan Visa Infinite Privilege Card $599 Up to $1,500

The Odyssey World Elite Mastercard

  • Mobile device coverage: up to a maximum of $1,000
  • Coverage starts: after 60 days of phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: $100 for devices with an MSRP of $600+ (or a deductible of $75 for devices with an MSRP of $400-$600)

Desjardins offers mobile device insurance on a handful of its credit cards, including its premium travel card: The Odyssey World Elite. For a $130 annual fee, the card comes with mobile device insurance and comprehensive travel insurance coverage of up to 60 days.


RBC Avion Visa Infinite

  • Mobile device coverage: up to a maximum of $1,500
  • Coverage starts: after 90 days of phone purchase
  • Coverage lasts: up to a maximum of 2 years from the date the phone was purchased
  • Phone depreciation: 2% per month
  • Deductible amount: 10% of the phone’s depreciated value (phone’s MSRP after the monthly depreciation)

What are your other cell phone insurance options?

Device protection from cell providers

When you purchase a new phone, your provider will try to up-sell you on everything; from a more expensive plan, to a cell phone case, and, of course, mobile protection plans. These plans are great in theory – drop your phone in the toilet, get a replacement device within days – but they can be costly.

Typically, you’re charged extra fees per month (on top of your mobile plan fees and the built-in fees to pay off the expensive device over the course of a couple years), which can add up. And you may not ever require the protection plan, which means the extra fees become unnecessary monthly costs.

Rogers, for example, charges $9 per month for its Device Protection Lite. That includes repair to your device if there is an out-of-warranty defect and up to two service requests within a 12-month period. They do, however, charge processing fees that range from $30-$175 per repair.

Telus charges $9 per month and offers an extended two year warranty plus three year accidental damage coverage. It includes two incidents of accidental liquid damage or manufacturing defects in a 24-month period. Service fees range from $25 to $400.

Bell offers device coverage that ranges from $10 per month to $16 per month, depending on the value of your cell phone. They all cover physical and liquid damage, and offer warranties that extend beyond 12 months.

So, these plans don’t come cheap. That said, if you’re someone who is rough on their cell phones, device protection offered by your cell provider might be worth it. That isn’t your only option, though.

Insurance from phone manufacturers

Insurance from phone manufactures is another option to protect yourself against the costs of having to replace a broken phone.

For example, Apple offers AppleCare+ for its cell phones. AppleCare+ extends your phone warranty for two years and includes screen fixes and accidental damage coverage.

AppleCare+ costs $249.00 up-front for the latest iPhone (which, at present time, is the 11 Pro. But we know how often new models are released). There are also service fees required for certain repairs, such as $39 for screen replacement and $129 for any other damage.

Samsung offers a similar service called Samsung Care+. It operates much the same as Apple’s service, offering up to two incidents of accidental damage coverage.

It operates on a tiered cost structure, costing $170, $189.99, or $209.99, depending on the plan you choose.

Of course, these services don’t come without fine print. So, if you’re considering opting into this sort of coverage, make sure to parse the details to make sure you understand the full costs and coverage.

Mobile device protection from retailers

If you purchased your phone from a retailer such as BestBuy, you can opt into their own device protection plans.

These plans operate in a similar fashion to manufacturer plans, and often offer up-front costs or staggered monthly fees. There are often service fees required as well. The services are also very similar, covering accidental damage and offering extended warranties.

Also read:

*This blog is for educational purposes only and isn’t legal advice. Check your credit card policy and phone provider’s terms for details.


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