Extended warranties are usually a terrible deal. You save enough in not paying the warranty costs over time to make up for the cost of any repairs or replacements you pay for out of pocket. However, despite never cracking the screen on any iPhone—from 2007 to present, knock wood!—I’ve made use of AppleCare+ multiple times, for the equivalent of several hundred dollars of repairs priced at independent third-party shops.
Most recently, my iPhone 5s was weeks out of warranty, the screen was delaminating, and it had dust in its camera. It’s unclear whether Apple would have repaired it without AppleCare+, but with it, there was no question. (They wound up trying to fix it, but made the camera worse. So the store then swapped it entirely with a refurbished model, which I then sold in mint condition to someone who knew they were getting a refurb.)
If you want to shoot Live Photos, you're gonna have to upgrade to a 6s. Credit: Apple
Carriers also offer insurance plans charged monthly, but these used to be priced too high and then you had to deal with insurance companies. This appears to have changed, with more explicit and straightforward offerings. AT&T has several tiers, but the basic $7 a month option (totaling $84 a year) covers loss, theft, and damage with a $199 deductible for phones like the iPhone 6s, and device failure at $89. (Deductibles go down over time if you make no claims.)
So far, I’ve opted into AppleCare+, and the calculus for my iPhone purchase has always includes that $99 or $129. This is why the iPhone Upgrade plan from Apple makes the best sense for me. The plan totals the cost of a phone and AppleCare+ and divides it into 24 payments with an upgrade option starting at 12 months. If you want AppleCare+ otherwise, you pay for it entirely upfront and it isn’t part of the trade-in value nor is the unused portion transferred by carriers or Apple to a new phone.
Consider the costs of my iPhone 6 and 6s, both of which were AT&T silver 64GB models and cost $749.99.
With AT&T, I paid $99 for AppleCare+ and $80.65 for sales tax (required upfront in Washington State), for a total of $179.65 at the time of purchase. I was then billed $37.50 per month thereafter. That’s a total of $929.64.
With the iPhone Upgrade plan, the total cost was $749 plus $129 for AppleCare+ (the s phones are more expensive to repair?). I paid $84.28 in tax upfront, and will total $962.28; the monthly installment is $36.58.
If I’d gone with AT&T for my renewal, the cost would have been identical overall and in both plans I would have been able to swap at 12 months. However, at 12 months, I’d have paid Apple less because the AppleCare+ was divided up, and because AT&T’s 12-month upgrade cycle requires 20 equal installments—not 24 as with Apple’s.
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