Computer insurance protects against loss, theft, or damage to computers. There are different types of policies, including warranty extensions and full coverage plans, but data insurance is not typically included. Premiums are based on the risk of loss and the price to compensate for the loss. Homeowner’s or renter’s insurance may cover some damage or loss, but separate policies may be needed for external damage or loss.
Computer insurance is a form of insurance policy designed to protect computers from loss, theft, or damage. While a computer is probably not the most expensive property a person could own, it is perhaps one of the most important. Computers are increasingly dependent on many facets of communication and data storage. Losing a computer can cause significant headaches, some of which an insurance plan can alleviate. There are many types of computer insurance, from basic warranty extensions to full coverage plans, and most can be tailored to an individual’s specific needs.
While not always marketed as insurance, extended warranty policies are one of the most frequently purchased computer insurance plans. Most of the time, computer manufacturers sell laptops, desktop computers, and other hardware that are subject to a limited warranty. Warranties are designed to protect the buyer from bearing the cost of repairing or replacing defective products. A typical warranty period is 30 days to a calendar year, but manufacturers often offer warranty extension programs to new computer buyers. For a small fee, buyers can continue to protect themselves against the risk of malfunction or defect for more than several years.
Most warranty programs do not cover accidental or user-inflicted damage. A warranty might replace a keyboard that cracked due to poor workmanship, for example, but generally won’t replace one that’s spilled coffee on it. To insure against external damage or loss, a computer owner often needs a separate insurance policy.
In some cases, homeowner’s or renter’s insurance may cover certain damage or loss to a computer owned by the policyholder. Theft is almost always covered, as long as the computer was stolen from the insured house or apartment. Computers damaged by floods, fires, or power surges on the property often are, too. However, as computers become increasingly mobile and portable, the chances of loss or damage within the home decrease. Insurance policies can often be tailored to cover loss or damage outside the home, but this coverage may not be included automatically.
Some insurance companies offer policies specifically geared towards computers that can be purchased independently. These policies can be individual or corporate in nature, and can often be tailored to meet the needs of the computer owner. A company may choose to purchase comprehensive system insurance to cover the full spectrum of network servers and all linked computers, while a college student may choose a minimal computer hardware insurance policy to protect a single laptop.
The one thing that many computer insurance providers do not offer is data insurance. While the files, photos, and documents stored on a hard drive may be some of the most important things to a computer owner, putting a price on data can be hard to do. Most data is also impossible or nearly impossible to replace. Some policies may provide the cost of labor to rebuild corporate data sets or other important figures, but it is generally best for a computer owner to back up data on a regular basis lest damage or loss of the hardware do not compromise the internal content.
Different types of computer insurance have different costs, usually based on a subscription for a fixed coverage period. Policy buyers will generally pay a certain amount of premium, either monthly or annually, to ensure coverage. Premium amounts are generally calculated as a factor of (1) the risk of loss to the insured; and (2) the price to compensate for the loss of the insured property. Most computer insurance plans are structured on a market value or replacement model. If a loss occurs, the insurance company must pay to replace the covered computer entirely or reimburse the policyholder for the fair market value of the damaged machine, provided the damage is so extensive that repairs cannot reasonably be made .
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