When you buy an iPhone through an AT&T store, they offer you insurance to protect your device. Yes, they give you the basic costs, but more than likely, the big picture won't be explained. Once you look closer at the details, another option may surface.

Here's a real life example. Just this week, I immersed my iPhone 5S beyond repair. Since I had bought the device directly from Apple, I had never considered insurance from my carrier, AT&T.

I submitted a service request via the Apple Online Store on Tuesday evening. The charge to replace my iPhone 5S was $269 plus tax. (The Apple warranty does not cover dunking the phone in water.) Apple submitted my info to UPS that night. The next morning I dropped off my phone at the closest UPS shipping center (they did the packing for me), and by Friday afternoon I had a replacement 5S, same configuration as I had bought, delivered by FedEx. The entire process took 3 days.

We have another iPhone 5S on our AT&T family plan that we purchased at an AT&T store. We opted for the $9.99 a month protection plan that is underwritten by Continental Casualty Company and administered by Asurion Protection Services. The deductible for the iPhone 5S is $199. We've had a claim with them before, and the entire process took over 2 weeks and included 3 phone calls.

The bottom line is this: Apple covers your iPhone for 1 year for free. There are certain exceptions such as water immersion. Even with the exception, they will replace your iPhone for less than $300 when out of warranty, and do so quickly and without hassle.

I'm not recommending one option over the other. But it's something to keep in mind the next time you find yourself purchasing a new iPhone at an AT&T store.

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