Unlocked Phones and Budget Carriers Are Blind Spots for Smartphone Insurance

Refusal to Subscribe When Using LTE Plans on 5G Phones
Proper Guidance Not Provided Even If Possible
iPhones Completely Ineligible for Budget Phone Insurance

[Asia Economy Reporter Han Jinju] Kim Ho-young (pseudonym), a worker in his 30s, recently purchased a Galaxy S20 as an unlocked phone from an online open market. He then visited a mobile carrier agency to sign up for smartphone insurance but was unsuccessful. The carrier agency required a receipt showing the product model name, and despite visiting the store more than three times, he failed to enroll.

Consumers who purchase smartphones as unlocked devices face discrimination due to strict conditions for loss and insurance enrollment. Budget phone operators also encourage insurance mainly for smartphones purchased from their own companies, leaving unlocked phone users effectively in an insurance blind spot.

According to the industry on the 20th, some carrier agencies refuse insurance enrollment if a 5G smartphone is used with an LTE plan. This effectively pressures customers to subscribe to 5G plans. In reality, it is possible to enroll in smartphone insurance even when using an LTE plan on a 5G smartphone, but proper guidance is often lacking. A KT official explained, "In the early days of unlocked phone commercialization, enrollment requirements were strict, but since the third quarter of last year, policies have changed so that even if you use a 4G plan on a 5G smartphone, you can enroll."

The barrier to insurance enrollment is also high for those who purchase an unlocked smartphone and only buy a budget phone USIM. The iPhone is such a case. Even if KT M Mobile and U+ Budget Mobile subscribers purchase a USIM and use a plan, iPhone users cannot enroll in insurance.

Most budget phone providers also allow insurance enrollment only for devices sold by themselves. Additionally, it is essential to confirm insurance eligibility before applying for a plan. An industry insider from the budget phone sector said, "Most devices sold directly by the company can be insured, but for unlocked phones, enrollment is difficult unless it is an Android device," adding, "If you enroll in insurance and lose your device, it must be replaced with a device you own, but iPhones are not handled."

iPhone users can subscribe to Apple's 'AppleCare Plus,' but loss is not covered, only damage. The AppleCare Plus premium for the iPhone 11 Pro is 269,000 KRW (for two years), supporting up to two repairs, but it is more expensive than damage insurance offered by carriers, which typically support one repair for a price in the high 100,000 KRW range.