AT&T's iPhone insurance to cost twice as much as SquareTrade

When the iPhone appeared, AT&T excluded it from its standard phone hardware insurance plan. Now it appears the company is ready to launch a plan specifically for the iPhone, at a rather steep $13.99 per month, significantly higher than third party warranties available from SquareTrade.

AT&T's new plan, underwritten by Asurion and branded "MobileProtect," was detailed in a report by BGR.

Expected to launch June 6, apparently alongside the new iPhone 4, the $13.99 plan must be purchased within 30 days of buying new hardware. It also carries a deductible of $99 to $199 depending on the model purchased.

Over the 24 month contract of a new phone, the plan would cost $335.76, which added to the $199 deductible of a 32GB iPhone 3GS would eventually cost $534.99, an expensive plan for a device that costs $699 to replace.

AT&T's MobileProtect extends AppleCare-style coverage of mechanical and electrical failures for two years and adds coverage for accidental damage (including drops and spills), loss and theft.

AT&T vs SquareTrade

In comparison, SquareTrade's third party warranties for iPhones cost either up to $9.99 per month, or when purchased in advance, $144 for 24 months of coverage (a 50% savings over paying monthly premiums, and less than half the AT&T plan's cost).

SquareTrade similarly extends the AppleCare-style coverage for two years, and adds two years of protection from drops and liquid spills (including humidity and full accidental submersion), damage AppleCare does not cover.

Unlike AT&T's plan, SquareTrade warranties do not cover lost or stolen devices; some homeowner's or renter's insurance policies may cover theft or environmental damage, but few cover accidental loss or disappearance.

Claims based on accidental damage (drops or spills) are subject to a $50 deductible under the SquareTrade plan, while problems related to mechanical or electrical failure from normal wear and tear have no deductible. The plan will also replace iPhone users' batteries if they drop below 50% of life during the coverage period.

The company provides a free UPS return label to send in a damage iPhone and will either repair and return or reimburse the user the replacement cost up to the rated value of the phone they have paid to cover (up to $499 for the 32GB iPhone) within five days of reciept.

SquareTrade warranties can be purchased up to 90 days after the phone is bought from an authorized iPhone outlet, and are also available for used iPhones purchased through eBay.

SquareTrade also offers a coverage plan for iPad with a 2 or 3 year term that costs from $96 to $136, a 20% off introductory special.