Carefully Review Insurance Terms for Coverage of Mobile Phones and Home Appliances
Mobile Phone Insurance Payouts Made After Deducting the Deductible
Travel Insurance Can Compensate for Mobile Phone Damage
#Mr. Kim, after his phone malfunctioned abnormally due to being submerged in seawater during his vacation, entrusted the product to a private repair shop near his home for repair and then filed a claim with his insurance company for reimbursement of the repair costs he bore. However, the insurance company denied the payment, citing that the repair was done through a private shop rather than the manufacturer's official service center.
#Mr. Park incurred a repair cost of 450,000 KRW for his phone but expected to receive the maximum compensation amount of 250,000 KRW from his insurance. However, the insurance company informed him that they would only compensate 175,000 KRW after deducting a 30% deductible from the 250,000 KRW.
The Financial Supervisory Service (FSS) stated on the 17th that consumers need to accurately understand the contents of insurance products that cover repair and replacement costs for mobile phones and home appliances, and disclosed related compensation cases along with important points in the terms and conditions.
Specifically, it pointed out that people may not be well aware that mobile phone insurance includes a 30% deductible when compensating for repair or replacement costs. According to the mobile phone insurance terms, the insurer pays the compensation after deducting the insured’s deductible from the lesser amount among the repair or replacement costs and the insurance contract’s insured amount.
Additionally, if insurance benefits have been received before, depending on the contract terms, the insured amount may be reduced by the amount previously paid, or the number of compensation claims may be limited. It also emphasized that compensation may not be provided in cases of theft rather than damage, so it is important to carefully check the contract details.
Mobile phone insurance only covers repairs done at official service centers, and damages occurring while a USIM card registered under another person’s name is installed, as well as damages that do not affect the phone’s original functions such as normal wear and gradual performance degradation, are not covered.
The mobile phone insurance terms stipulate that in cases of total loss due to theft or loss of the phone, the insurance company will provide a replacement device of the same model through an official service center designated by the insurer. If the replacement device’s retail price exceeds the insured amount, the insured must bear the difference.
Phones damaged during overseas travel can also be compensated through travel insurance. Compensation is possible within the 'Personal Belongings Damage Rider' limit of 200,000 KRW per item.
Furthermore, extended warranty insurance covers only the types of malfunctions eligible for free repair services by the manufacturer, even after the free repair period ends. For example, if a TV or refrigerator is accidentally damaged but is not covered under the product warranty for free repair, the repair must be paid for. It was also explained that some property insurance policies, such as home fire insurance or driver insurance, may include riders that cover repair costs for home appliances, so these should also be reviewed carefully.
An FSS official emphasized, "When mobile phones or home appliances are damaged or broken, the repair costs can be high, causing significant financial burden on consumers. It is necessary to have a more accurate understanding of the related insurance products."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
