Market Analysis Summary
In a world where society has become so dependent on technology, cellphones nowadays have the ability to connect business men to corporate meetings from the other side of the globe, military personnel the opportunity to see their baby being born while away at war, and friends the opportunity to keep up to date on what one another are doing. The cellular industry has become mainstream in almost everyone’s life. When someone’s phone is suddenly taken away from them in a tragic accident such as dropping the phone in the toilet, or cracking the screen on the concrete, or even forgetting that your phone was on the top of the car as you drove away, it is as though the phone owner has just suffered a devastating loss. Many consumers opt out when the option of purchasing insurance on their cellphones. However when they damage their device, lose it or it is stolen, they have limited options. That phone they received at a substantial discount is now full retail price to replace. With most phones on the market today costing in upwards of $600 to $850 dollars to replace, the $10 insurance policy would have been worth purchasing at the time.
Pros and Cons
With every insurance policy there is a deductible for a replacement phone, this deductible can cost a consumer between $45 for a basic phone, and up to $165 for an iPhone. Most carriers have one company they work with for their insurance company. Due to the limited number of insurance companies an oligopoly market exists within the cellular phone insurance market. This allows for the insurance companies to set the cost for the deductible, contract terms, and also the premium. The benefits for having cellphone insurance are as follow:
Relatively quick receipt of your replacement phone.
Phone of same or newer model of device.
Cheap deductible when compared to the total cost of a new phone.
Protects against damage not covered under manufacturer...