My SquareTrade Experience

Because I wasn’t willing to spend north of $600 on a handset, it took me a few months to work out an upgrade scheme by which I could move from my aging Nexus One to its newer cousin, the Galaxy Nexus. In March of this year, I bought an unlocked Galaxy Nexus from Amazon, then used my AT&T subsidized upgrade to secure a Galaxy Note. For reasons I still don’t understand, the Galaxy Note sold for more than the Nexus cost, so in effect I bought the Nexus for a subsidized $299 cost in spite of the fact that AT&T never offered the device.

Anticipating, however, that replacing the phone in the case of breakage would likely be costly and complicated, I purchased an after-market warranty from SquareTrade. For $69.99, I bought 12 months of coverage against accidental damage. Which I engaged two weeks ago when my Nexus became entangled in a cord, dropped on a granite counter and cracked the screen in three places. Here’s the good, the bad and the ugly of my SquareTrade experience.

The Good

The good news is that SquareTrade was able to repair my Nexus perfectly, with no questions asked. The phone was returned to me in exactly the condition I sent it to them, except for the brand new display. We’ll see how the repair holds up over time, but from the initial inspection the work was done correctly.

So ultimately, I got exactly what I wanted: my phone restored to its pre-dropped state. As a bonus, the logistics of the return were straighforward. I filed a claim online and they processed it same day. The claim return included a shipping label; after packing the unit up I dropped it off at the local UPS store and walked away.

The Bad

The bad news isn’t SquareTrade’s fault exactly, but the economics of the warranty are less compelling than I’d hoped at the time of purchase. Since I bought my Galaxy Nexus, prices for the handset have come down significantly. With the Galaxy Nexus’ replacement the Nexus 4 now out and selling for as little as $299, the cost of an unlocked Galaxy Nexus is around $200 today. Compared to that replacement cost, the SquareTrade warranty, which came to $168.99 including the $99.00 deductible, represents a marginal savings for a replacement handset. For a mere $130 over the warranty cost, I could have upgraded from the Galaxy Nexus to the Nexus 4.

The Ugly

The real problem with SquareTrade for me, however, was the delay. Although I didn’t realize it at the time, the shipping label provided to me by SquareTrade was for UPS Ground service. Because the unit shipped from Portland, ME and was headed to Los Angeles, the transit time was a full week. The unit was dropped off at the Portland UPS store Monday the 15th and was signed for in LA Monday the 22nd. It then took SquareTrade three days to process my claim; the unit was shipped backed to me Thursday the 25th. To SquareTrade’s credit, the return shipment was next day air, and it’s not SquareTrade’s fault that while UPS promised to deliver the package Friday it failed to due to “adverse weather conditions” on a day that was 48 degrees and partly cloudy.

Even in a best case scenario, however, my total time without the handset would have been ten business days. I was fortunate to have my Nexus One to use as a replacement, but many users probably don’t have second phones readily at hand. In which case they can be expected to be without a phone for a period of days, best case. For most people, that delay will be unacceptable.

The Net

In the end, SquareTrade lived up to their promise: they repaired my phone for the agreed upon deductible, and my Galaxy Nexus has been restored to its prior condition. It’s not clear, however, that the extended duration of the replacement process was worth the marginal cost savings the warranty afforded, though the economics would admittedly have been more in SquareTrade’s favor if I’d broken the device earlier in the contract.

The net is that those evaluating a potential SquareTrade warranty should consider carefully the replacement cost of the device, both at the time of purchase and over the life of the contract. In my case, with Google making their handsets available directly for half the cost that I paid originally, I’m unlikely to purchase another SquareTrade warranty moving forward for a phone.

If you lack realistic service options, however, and the cost of your device justifies repair, SquareTrade may make more sense for you.