Why Digital Nomads Need More Than Just Travel Insurance for Their Phones

Digital nomads depend on a phone for almost everything. It provides access to all your documents, photos, money, and community connections. Traveling without a phone becomes a serious detriment, so many people get travel insurance.

But relying solely on travel insurance might not be enough. Digital nomads should consider phone insurance that offers more specialized protection, fitting for their lifestyle. This guide will go over phone insurance, its pros and cons, and how to find the best insurance for digital nomads.

The Digital Nomad Lifestyle and Reliance on Phones

Got an email? Check it on your phone. Need to call a client? Zoom them on your phone. Lost? Maps will teach you the way on your phone. Phones are essential for everything, such as:

• Work
• Banking
• Navigation
• Payments
• Social media + texts
• Entertainment

Being always connected gives you plenty of freedom for anything you want. Digital nomads are always connected. However, that means if you lose or damage your phone, you lose a lot of connections and resources. This can threaten your income and opportunities.

Digital nomads often spend time in coworking spaces, coffee shops, airports, and hostels. These are all places with great exposure to risks, like thieves and hostile people.

What Travel Insurance Usually Covers (and Exclusions)

Coverage basics

The basic coverage of travel insurance typically includes:

Trip cancellations: Trip cancellation insurance is a crucial benefit of travel insurance for digital nomads. If you get hospitalized or the weather becomes unsafe before departure, trip cancellation insurance can reimburse you for the lost trip investments, mainly the prepaid, nonrefundable expenses.

Emergency medical: Domestic health insurance does not cover most international expenses. Travel health insurance is a necessity that prevents digital nomads from being unable to afford health expenses abroad.

Lost luggage: Baggage insurance is a part of some travel insurance policies. If your baggage gets lost while you’re on a plane or train, baggage insurance policies can reimburse you for the lost value, letting you afford necessities.

Phone-related coverage

Standard travel insurance has limited compensation and coverage for theft or loss. Travel insurance’s baggage insurance deals with baggage that gets lost during transport. This may include your phone if it is in your luggage at the time of the baggage delay or loss.

However, baggage insurance might not cover a high enough amount to reimburse you for your phone on top of other belongings. Check your travel insurance policy’s coverage limits to see if you would benefit from extra phone insurance coverage. Plus, if your phone gets damaged and requires repairs, these expenses might not be eligible for travel insurance claims.

Exclusions

Travel insurance usually has the following exclusions that are relevant for the needs of digital nomads:

Cyber crimes: Cyber fraud and other mobile crimes are not covered by standard travel insurance. Digital attacks are not traditional perils. If you connect with the wrong public Wi-Fi and get your phone security breached, this is unrelated to travel insurance.

Accidental damage: Some travel insurance policies will cover the theft of your belongings while abroad. However, if you accidentally drop your phone into a spa or onto a rock during your trip, the resulting repairs and replacements won’t be covered by travel insurance.

High-value device limits: If you have an expensive phone, like a flagship iPhone or a foldable Samsung Galaxy Z, these devices cost thousands of dollars.

The Risks Nomads Face That Travel Insurance Misses

Physical damage

The first, simplest type of damage is the kind that comes from dropping your phone. Components can crack or fall apart. The screen can break or shatter, exposing the parts underneath. Repairing a phone screen can cost upwards $500 to repair depending on the severity.

Water spillage or other liquid damage is a serious problem for phones. If you plan on heading to a pool or beach, dipping your phone in could cause irreparable damage to it, making you lose all of your data that has not been backed up. Light water damage can cost up to $400 to repair.

Climate-related issues (humidity, sand, heat) are a rarer type of phone damage, but digital nomads can encounter them while traveling, particularly to remote locations.

Theft in high-risk areas

Phone theft is common in crowded markets, coffee shops, coworking spaces, and public transit. Dense, metropolitan areas make it even more likely to encounter thieves. If you’re dressed like a traveler, wealthy tourist, or outsider, muggers and thieves might target you even more.

If your phone gets stolen, there is a slim chance you can get it back if you file a police report or have a GPS phone finding app. The greater likelihood is that you’re going to need to buy a new phone. Phone insurance is best for replacing a stolen phone, paying out enough so digital nomads can afford replacement phones even on a limited budget.

Cyber threats

You probably have heard of modern cyber threats. Malware isn’t the only danger. We encounter hacked Wi-Fi, SIM-swap fraud, phishing, and other social engineering.

Travel insurance doesn’t deal with cyber threats. It’s more about protecting your trip from unexpected physical obstacles, such as surprise tropical storms or airline strikes.

Cyber insurance is important for digital nomads who spend a lot of time on their phones.

Data/reputation loss

If you use your phone for remote work or storing important business info, phone trouble could result in stolen client files or hacked business accounts. Stolen work phones can be significant security risks for businesses because of:

• Data breaches
• Unauthorized access
• Identity fraud
• Legal and financial liability

How Phone Insurance Fills the Gap

Device protection

Phone insurance can help you pay for repairs and replacements worldwide. A complete phone replacement of a flagship phone can be worth over $1000. Some travel insurance policies would be willing to cover this phone replacement cost, but it might unnecessarily and drastically raise the travel insurance premium.

Device repair costs can also cost a few hundred dollars each. What if your phone breaks multiple times? Digital nomads working often on their phones will have their phones at perpetual risk. Having phone insurance ensures that every single time an eligible expense goes toward repairing or replacing your phone, you won’t need to pay anything except a small deductible.

Cybersecurity coverage

Cybersecurity is a necessity for digital nomads. It protects both your leisure and work from cyber criminals. Best practices include double checking emails, links, and messages from senders.

Cybersecurity has advanced to provide both pre- and post-cyberattack assistance. Cyber phone insurance policies can help you with identity theft assistance, unauthorized transaction reimbursement, and more. Having a global hotline available to you is a great benefit for digital nomads looking to secure their phones and digital identity.

Cloud/data support

It’s important for digital nomads to have various data backup and restoration options. Some phone insurance policies will help you with cloud support.

Global claims support

Global insurance support is surprisingly useful when you’re traveling across different countries. If you have an upcoming travel or work obligation and you need insurance to pay you for a phone repair ASAP, global insurance assistance is crucial. You can’t wait to travel back home.

Accessory coverage

Phone insurance can also cover other devices and accessories, depending on the policy. Do you have any earbuds, wearables, or laptops? Multi-device and accessory phone insurance can be useful. Earbuds aren’t all $15 accessories you can buy at any store anymore. Earbuds can cost hundreds of dollars, and laptops can cost even more than phones.

Real-World Scenarios

It’s easy to say that digital nomads can benefit from insurance, but how exactly can they? Here are some real world situations where digital nomads can protect their lifestyle with insurance policies.

• A freelancer loses their phone in Mexico. Travel insurance offers partial payout, but phone insurance covers a full replacement
• A SIM-swap attack drains a digital nomad’s online bank account. Cyber insurance’s protective add-ons assist the nomad in retrieving his bank account and undoing fraudulent activity
• A traveler is relaxing in Bali’s resort, when he drops his phone in water. The water damage is irreparable. Within a day, it is replaced through global phone insurance

Best Practices for Nomads Choosing Phone Insurance

Let’s go over some of the best practices digital nomads can use to pick the best phone insurance coverage.

Look for worldwide coverage and multi-country claims

Traveling around means that you need a flexible insurance company with global coverage, or at least coverage in your chosen destinations. If your phone insurance doesn’t offer multi-state or multi-country coverage, then you should look elsewhere for proper coverage.

Confirm digital identity and cyber protection are included

Not every phone insurance plan comes with digital identity protection. If it’s important to you, check if the device insurance comes with digital identity protection coverage or cyber crime protection. Cyber protection plans are generally cheaper for individuals than businesses.

Check payout limits vs. actual phone value

You need to know insurance coverage limits before purchasing or filing a claim. The payout limit is the maximum amount each claim (or policy term) can give you.

Some digital nomads do not truly need phone insurance because they mainly operate on their laptops and tablets, not phones. Budget or lower-end phones are not as good for digital nomads who can easily absorb the cost of a new phone.

Consider bundles

When compared to stand alone policies, bundles of travel and device insurance may be cheaper. Keep an eye out for phone insurance bundles, discounts, and coupons.

The Future of Insurance for Digital Nomads

On-demand, pay-per-day coverage

On-demand auto insurance and travel insurance policies are already entering the fray. It is possible that in the future, on-demand, usage-based insurance will also appear in the phone insurance world.

AI-powered fraud monitoring

Fraud monitoring is a useful tool for all sorts of fraud, from credit card fraud to identity fraud. If insurance can cover or discount fraud monitoring expenses, it can be extremely useful for device-reliant travelers on a limited budget.

Bundled “digital life insurance”

Digital life insurance in the future should be able to cover all devices and data. Understandably, this type of insurance product would be more expensive than normal device insurance, since it would likely cover data theft, identity fraud, and other risks. Digital nomad insurance bundles will also likely group up various other insurance types, from travel health insurance to cyber security insurance.

Additional benefits

Insurance policyholders often get extra benefits and perks from their insurance companies. Digital nomad insurance policies might start offering embedded benefits such as:

• Telemedicine
• Cybersecurity
• Identity fraud protection
• Global 24/7 assistance hotlines

Conclusion

Phones are a lifeline, better you can afford more of them in case yours gets destroyed. If you’re a digital nomad, you should consider phone insurance and cyber protection measures, on top of travel insurance, to make sure your lifeline is protected.

Think about your coverage before your next trip. Quickly compare the best phone insurance companies and best travel insurance companies to protect your essential devices today.