COVERAGES FOR HOTEL & MOTEL INSURANCE

Insurance for your hotel 

that treats you just as well as you treat your customers.

Your job is based around taking care of other people and making sure they have an excellent experience while staying on your property. Our job is taking care of you and making sure your insurance coverage protects your hotel or motel from the hazards unique to your industry. Hospitality Insurance Agency brings you 100 plus combined years of experience to give you insurance coverage that will serve your hotel or motel well. As a true member of your team, we’ll make sure you understand exactly what you need, and then we’ll get it for you. It’s so easy, you might just feel like you’re on vacation.

KEY AVAILABLE COVERAGES FOR HOTEL & MOTEL INSURANCE

                 Property Coverage for Hotels and Motels

• Blanket/Agreed Amount Options
• Business Income
• Ordinance or Law Coverage
• Data Processing Equipment/Media
  - Newly Acquired Equipment
  - Newly Acquired Data/Media
  - Duplicate Data and Media
• - Computer Virus Extraction Expense

• Utility Services
• Flood and Earthquake
• Outdoor Property
• Appurtenant Buildings and Structures
• Electronic Vandalism Sub-limit
• Equipment Breakdown

Auto Coverage for Hotels and Motels

• Liability and Physical Damage
• Scheduled Rated
• Rental Reimbursement
• Business Auto Coverage Extension
  - Broad Form Named Insured
  - Blanket Waiver of Subrogation
  - Employees as Insureds
  - Hired Car — Worldwide Coverage
  - Unintentional Errors and Omissions

General Liability Insurance for Hotels and Motels

• Premises/Operations and Products Completed Operations
• Limited Worldwide Coverage

Industry-Specific Coverage for Hotels and Motels

• Hospitality Errors and Omissions
• Personal Grooming Services Liability
• Guest’s Property
• Restaurant Wine Stock Endorsement

Workers Compensation Insurance for Hotels and Motels

• Combining state-of-the-art technology with co-located claim and medical professionals. Highlights include:
  - Extensive Preferred Provider Networks with a presence in all 50 states
  - Pharmacy Network
  - Focus on Early Intervention
  - Medical Case Management
  - Return-to-Work Programs
  - Medical Cost Containment

Umbrella/Excess Liability Insurance for Hotels and Motels

• Providing excess layers of protection over your liability coverages
• Flexible and substantial limits capacity
• Built-in coverages including:
  - Worldwide Territory
  - Insured Status for Employed Health Professionals
  - Follow Form Fellow Employee Coverage

Crime Insurance for Hotels and Motels

• Employee Dishonesty
• Forgery and Alteration
• Theft, Disappearance and Destruction
• Robbery and Safe Burglary
• Computer Fraud
• Kidnap & Ransom
• Identity Fraud Expense Reimbursement

Management Liability Insurance for Hotels and Motels

• Employment Practices Liability
  - Protection against employee lawsuits alleging discrimination, sexual harassment and more.
  - Broad definition of Wrongful Employment Practice
  - Broad definition of Insured
• Risk Management Service for Employment Practices
  - Directors and Officers Liability
  - Protection against shareholder and creditor lawsuits
  - Worldwide Coverage
  - Broad definition of Wrongful Acts
  - General Partnership Liability Coverage available
• Fiduciary Liability
  - Protection against ERISA lawsuits alleging breach of fiduciary duty
  - Definition of Insured includes pension and welfare plan trustees
  - IRS and Department of Labor (DOL) voluntary settlement program coverage

Internet Liability Insurance for Hotels and Motels

• Internet Liability coverage that can be designed to protect against the following wrongful acts:
  - Failure to protect private or confidential information of others from unauthorized access on or through the Internet
  - Failure to prevent the transmission of a computer virus to authorized users of the insured’s Web site on or through the Internet
  - Failure to provide access to authorized users of the insured’s Web site on or through the Internet
  - Infringement of copyright, trademark, trade name, or service mark, but only in the insured’s material on or through the Internet

Hotel Insurance

Obtaining a hotel insurance quote is one of the main considerations before you start running your hotel business. Insurance for a hotel should be one of your most important business considerations to ensure adequate protection for your livelihood. If you are running a hotel of what ever size or description, you will certainly need a range of insurance policies to protect your business. The good news is that, most of these covers can now be purchased under a 'Hoteliers Combined' insurance contract. A modern hotel insurance policy will cover various different contingencies and will be arranged in different sections.

The insurer issuing the policy will require a certain number of minimum sections to be purchased. Whilst many of these sections will be a matter of personal choice and budget, some will be compulsory to enable you to trade legally. If you have any employees, you will need employers liability insurance as this is a requirement of the Employers Liability Protection Act 1969. If you have purchased the building of your hotel on a mortgage or other type of bank loan, then the lender will want you to effect building insurance, with their name mention on the policy, thus protecting their interest. When starting any new business, cash flow is a major consideration and there may be a tendency to cut down on the number of sections of the hotel Insurance policy taken out to make it as cheap as possible.

However, if you are to fully protect your business, it's worth while taking a moment to fully understand each section of the policy and what it has to offer in terms of protection for your hotel business. As mention above, most policies are now arranged on a package basis as is the norm with business insurance polices, this makes them easier to administer for both the policyholder and the insurer, if you are looking for a cheap hotel insurance policy with a wide variety of covers, buying on this basis could help to keep the cost down. Briefly, the sections covered on a hotels insurance policy, will include the following:-

1) Hotels Insurance for Buildings - if you own the property, insuring the hotel buildings will be one of the core necessary policy sections for you. If you have a mortgage on the property, the lenders will probably want their interest noted on the schedule and will provide you with a list of perils that must be included under the cover. You will need to provide an accurate sum insured for rebuilding costs, your lender may be able to help you with this, particularly if they carried out a survey on the premises. If they didn't, then you should obtain professional help, it's not worth having a guess at it which could end up having some severe consequences. It is essential that this sum insured is adequate for your needs as it is the maximum amount that the insurance company will pay and in some cases, if the sum insured is not adequate, compensation for an incident may be reduced. The building sum insured should also include all the fixtures and fittings, walls, fences & gates and the piping & cabling belonging to the hotel or for which it is responsible. The perils insured are fairly similar to a standard building insurance policy although there is no section for loss of rent or alternative accommodation. If you are an owner occupier, then you will need to effect the business interruption section of the policy to protect you against loss of income following an insured event. If you are a landlord, looking for buildings insurance, that has been rented to a hotelier, then you should be able to include loss of rent cover but the building may be better covered under a different form of policy. 

2) Stock, Trade Contents & Tenants Improvements - this section of the policy will cover you against material damage from a wide range of hotels insurance perils, such as fires, floods thefts etc. The three sections are as follows; Stock, which is defined as stock and materials in trade ( such as foods or foods to be prepared, wines & spirits etc) or stock which is being held in trust for which you are responsible. Contents relates to all contents within the hotel, such as tables, chairs, beds, including machinery & plant, equipment, fittings, frontage & signs & blinds. In many cases, where the hotel is rented from a landlord, the proprietor will be responsible for signs & glass etc as the insurers of the building may not cover them. Glass in the property, should be included in the glass section of the policy, again in you rent your hotel, you may be responsible to insure the glass. Tenants improvements relate to any improvements and internal decorations which are your responsibility or which you own, again this applies if you are renting the hotel from a landlord. The range of perils is quite wide, but with regard to damage to Stock, 'spoilage' can be covered to refrigerated stock in another section of the policy. Before requesting your quotation, you may need to spend some time calculating the replacement amounts of the above as these figurers will be required by the insurers in order to calculate a premium. 

3) Business Interruption (Loss of Income) - this a very important section of the hotels insurance policy and one that is sometimes overlooked by many persons buying insurance, especially if it is being sold on a non package basis or it may be an optional add on. In essence, this section of the hotel insurance policy will cover you in the event of a loss occurring at your property that interrupts your trade, resulting in a loss of income for you. Whilst the above sections will cover you for material property damage, it is this section of the policy that will protect your livelihood, whilst the insurance company are reinstating your property. In many cases, particularly following a serious event, it may not possible to run your business for several months which could result in a loss of bookings, especially if the loss occurs within your peak season. In other cases, you may be able to keep trading but with a smaller turnover. There are a number of ways of calculating a sum insured for this section of the policy. The easiest way is if the insurance company selects a sum insured for you, in most cases, this is a sum far in excess of what is actually needed and is ideal for a small business. For larger concerns, insurers may want to know the gross profit of the business and they will base there premium on this amount.A simple way to calculate gross profit for a business is as follows: Sales (turnover) + Closing Stock - Purchases & Opening Stock . So if you turnover over £250000 per annum (the amount you take in return for accommodation, food beverages etc) and at the end of your twelve month trading period you have £1000 stock remaining you subtract the amount you have spent on buying your stock say £50000 and the stock you had at the start of the year ( say £2000). This will give you a gross profit of £199,000. This is probably the safest way of calculating gross profit as it leaves in the equation, fixed costs that may or may not reduce in the event of a serious loss. You can insure for a period of up to 12 months but this sometimes can be extended for up to 36 months. There are some useful extensions to this section which include: denial of access ( in case you are effected by a problem occurring in the vicinity of your property, which prevents access to your hotel premises) murder, disease or public health closure, or failure of public utilities.

4) Loss of Money - business money can be covered under the policy and there are usually pre set limits on the policy which you may have the option to extend. Money will be covered on the premises and in transit to the bank. One notable exclusion is theft from unattended motor vehicles, any theft by employees must be reported with in seven days of the occurrence. The insurance company will usually choose the sum insured for you. In most cases, this is perfectly adequate although larger concerns will need to consider the amounts on offer carefully.

Restaurant Insurance

Great insurance for restaurants is as important to the future of your business as an irresistible menu and good customer reviews. But if your policy is outdated or inadequate, you could be risking everything. As your business changes, so too should your insurance. New equipment, new locations, new services — they can all impact your coverage. If a fire destroys your kitchen, or a customer slips and falls, will your insurance help keep your doors open?

We know that thinking about your restaurant insurance is probably on the back burner. So Nationwide makes it easy for you. We understand your risks and challenges, and will help create the policy you need so you can stay focused on the food with insurance for restaurants.

A recipe for the perfect restaurant insurance quote

Nationwide’s Premier Businessowners Policy (BOP) for restaurants includes essential insurance ingredients such as business property insurance and business general liability insurance. Additional coverage options can then be added to your policy to match your specific needs. From sushi to salad bars, we’ll help you get the coverage you want.

Options for customized insurance for restaurants

Because restaurants vary dramatically depending on size, location and style, your businessowner’s policy may be customized with affordable options, such as:

• Liquor Liability Coverage
• Food Contamination Coverage
• Equipment Breakdown Coverage
• Business Income Coverage
• Business Umbrella Insurance

Restaurant insurance choices

Chances are good you have questions about the insurance you need. Here are more details about restaurant coverage, and why Nationwide is such a smart choice for protecting your business.

Let’s face it, accidents in restaurants happen. Most commonly an employee might slip and fall, but that is why most restaurants require non-slip soles for waiters, waitresses, and the rest of the house. But what about the people who visit your restaurant in stiletto heels or worse, wheel-bottomed Heelys? 

Customer slip and fall accidents have been on the rise in many restaurants across the United States. Kurt Leisure, director of risk management for the Cheesecake Factory based in Calabasas, California, believes customer accidents should be more carefully watched by everyone working in the restaurant.

"I think it is important that restaurant companies empower their employees with the idea that a slip-or-fall hazard is everybody's problem, not just the servers' or managers'. But everybody in the front-of-the-house has a stake in it,”says Leisure. 

Some tips Leisure has put in place at the Cheesecake Factory restaurants could be useful in others as well.

• Keep collapsible wet floor signs hidden on the restaurant floor behind plants and other fixtures, so if a sudden spill occurs, the sign can be grabbed quickly making customers and other employees aware of the hazard.
• If there is a wet spot or spill and no sign near, have a manager or hostess stand over the spot until a busser is notified and can make the area safe.
• Make a system. Inform your staff any time there is a spill how to go about taking care of it and keeping the customers safe and your co-workers safe.

Employee slips and falls can easily be eliminated says Leisure. "The key is that you've got to have a slip-resistant shoe program, and it has to be rolled out correctly. It's the No. 1 defense against employee injury,” says Leisure as he has reduced the amount of slips and falls by 87% among the chain.” 

Cuts, burns, and scrapes are the most common California workers compensation claims reported since they generally cause missed work based on the injury. Perhaps surprisingly, the cause of such happenings are usually related to slipping and falling and trying to catch yourself on the way down. 

Making sure your employees are safe is important; keeping your customers safe should be a priority. Having the correct workers compensation plan in your business is important, but having general liability insurance in the case that a customer is injured should be a main concern as well.

Cattles Insurance

Feedlot Cattle Insurance Provides coverage for livestock in open air or pastures from an array of perils. True Peace of Mind Protection A true livestock producer doesn’t consider their cattle as "contents." So why should their insurance? Our coverages specifically protect valuable livestock for an array of perils, including:
Fire and Lightning/Smoke Windstorm, Hurricane, Cyclone and/or Tornado Hail Explosion, Riots or Riot Attending Strike, Civil Commotion Falling Aircraft and Objects Falling from Aircraft	Collapse of Bridges or Culverts Accidental Shooting (except by the insured, livestock owner or their employees) Drowning / Electrocution Attack by Wild Dogs Building Collapse Collision with a Vehicle Smothering
Features That Put You Out Front We offer the flexibility you need to tailor a program that fits each insured’s situation: Easily accommodates both feedlot and pasture cattle - on a single policy Pays for losses at current market value – at time of loss Provides annual or monthly reporting Offers flexible deductibles Covers extensions available for contaminated feed and measles

IAG Feedlot Cattle Coverage Options
Option	What It Covers / Provides	Special Notes
Contaminated Feed	Provides coverage for animal deaths caused by consumption of tainted feedstuffs	Separate deductibles and loss procedures apply to this endorsement
Coverage in Transit	Fills coverage gaps for operations requiring transportation of cattle from one listed location to another	Can be written on a limited cause of loss or broad form
Freezing Coverage for Feedlot Cattle	Covers feedlot cattle in the event of death due to freezing precipitation	Separate deductibles and loss procedures apply to this endorsement
Mortgage & Stolen Liability Coverage	Protects insureds if they ever unknowingly buy or sell mortgaged or stolen livestock	Separate deductibles and loss procedures apply to this endorsement

Horses Insurance

LIVESTOCK MORTALITY/THEFT The Livestock Mortality/Theft policy is a Life Insurance policy for your horse(s) or cattle, with the insured as beneficiary.  It is an "All Risk" policy which will cover death, theft and humane destruction, subject to certain exclusions which are stated in the policy. We will pay the actual value of the horse at the time of the accident or illness causing its death, not exceeding the value specified in the schedule.  If your horse is sick or injured before the policy expires and you have reported this to us, we will extend your mortality coverage for an additional 12 months should the horse die within that time from the same cause. If your horse is under 12 months old, 15 years or older, or valued over $100,000, a vet exam is required.  Or vet exams may also be required at the underwriting companies request. We will issue a Livestock Mortality/Theft policy provided the insured's horse is in sound health at the inception of the policy.  We also assume you will provide proper care and attention for the horse and that you will employ a licensed veternarian at your expense if the horse suffers any illness, disease, lameness, injury, accident or physical disability.  In addition, if your horse dies, you are required to arrange and pay for an autopsy. Please note new endorsement coverages and limits available effective March 2010 under the FORMS tab, Equine Mortality Application, Page 2. *Major Medical is now available for horses through the age of 20 years under the new endorsement coverage.  COLIC ENDORSEMENT ($150 Per horse) This endorsement covers colic treatment and surgery for horses 30 days old through the age of 20 years. There is a $250 deductible for each claim and a $10,000 limit per animal per year.  Available for race horses.

SURGICAL ENDORSEMENT ($150 Per horse) Should your horse require surgery, this endorsement will cover the Surgical Procedures.  We will pay reasonable and customary charges for surgical treatment, including anesthesia, necessitated by accident, illness or injury.  There is a $250 deductible for each claim and a $10,000 limit per animal per year.  Available for horses 30 days old through the age of 20 years. Certain exclusions apply, including race horses, castration and cattle.

$10,000 MAJOR MEDICAL ENDORSEMENT ($375 Per horse) This insurance reimburses for veterinarian's fees for surgery and major illnesses and disease.  We will pay reasonable and customary charges necessitated by accident, injury or illness for your insured horse.  There is a $250 deductible for each claim and a 30% coinsurance on diagnostics with a $10,000 limit per animal per year.  This coverage will help control veterinarian expenses for unforseen events dealing with the health of your animal.  Available for horses 30 days old through the age of 20 years.  Not available for race horses or cattle. $15,000 MAJOR MEDICAL ENDORSEMENT ($475 Per horse)  This insurance reimburses for veterinarian's fees for surgery and major illnesses and disease.  We will pay reasonable and customary charges necessitated by accident, injury or illness for your insured horse.  There is a $250 deductible for each claim and a 30% coinsurance on diagnostics with a $15,000 limit per animal per year.  This coverage will help control veterinarian expenses for unforseen events dealing with the health of your animal.  Available for horses 30 days old through the age of 20 years.  Not available for race horses or cattle.

LOSS OF USE ENDORSEMENT  (3.75% of insured value and requires the Major Medical or Surgical Endorsement) This coverage is available on Cutting, Reining and Show Horses valued between $25,000 and $500,000, 3 through 12 years of age, and is pending Underwriter approval.  The Loss of Use will cover you if your horse becomes permanently incapable of fulfilling the functions for which it is used as stated on your policy but its condition does not necessitate destruction for humane reasons.  If you purchase the Loss of Use endorsement we will pay you 70% of the insured value of the disabled horse.  If you wish to keep the horse, we will pay you 50% of the horse's insured value.

ACCIDENT, SICKNESS AND DISEASE FERTILITY ENDORSEMENT (.5% of insured value) This endorsement will reimburse you the full value of your horse, between 1 to 14 years old, should he become permanently incapable of servicing a mare in foal due to specific accident, sickness or disease that occurs within the policy term.  If a claim is paid under this coverage, the company does have the right to take possession and title of the horse.  Certain exclusions apply, including congenital conditions

Forest Insurance

WoodlandCover provides forestry insurance tailored for the Irish market, North and South. Your forestry is a valuable asset. As with any investment there are some risks - especially fire and wind.

Protect your forestry asset from loss caused by fire or wind with forestry insurance from WoodlandCover. We also arrange public liability insurance for woodlands.

Our WoodlandCover group scheme is  for owners, investors and woodland managers and provides for virtually all your forestry insurance needs.

We have over twenty five years of unrivalled forestry experience and the technical knowledge and market access to bring you appropriate insurance cover for your needs.

Risk evaluation and appropriate insurance cover are essential features of good forest management. We support this through arranging forestry insurance appropriate to the needs of Irish forestry. In Northern Ireland cover can be specified in Sterling.

Our clients include individual owners, farmers, investment portfolios and many forestry managers. Together with Willis and Aviva we bring international resources to the Irish market.

Farm Insurance

State Farm Insurance is a group of insurance and financial services companies in the United States. The company also has operations in Canada.

The group's main business is State Farm Mutual Automobile Insurance Company, a mutual insurance firm that also owns the other State Farm companies. The corporate headquarters are in Bloomington, Illinois.

State Farm is ranked 34th in the 2010 Fortune 500, which lists American companies by revenue. According to the Fortune Global 500, State Farm is also the world's largest mutual "P&C" (property & casualty insurance) firm. In October 2008, State Farm Insurance Companies in Canada was named one of Greater Toronto's Top Employers by Mediacorp Canada Inc., which was announced by the Toronto Star newspaper.

Home and Contents

Your Elders Farm Insurance Policy gives you the flexibility to choose from two types of cover:

Defined Events

This covers you for a nominated event such as:

• Theft
• Fire, smoke, lightning or explosion
• Earthquake, storm or rainwater (excluding flood)
• Malicious damage
• Impact from falling trees, vehicles or aircraft
• Breakage of fixed glass
• Other events as listed in the policy

Accidental Damage

We cover you for accidental loss or damage to your Building and Contents subject to the specific exclusions outlined in the policy.

Farm Property Cover

Your policy covers:

• Farm Buildings
• Farm Contents
• Mobile Machinery
• Fixed Machinery
• Hay, silage and grain
• Fences
• Wool
• Livestock
• Farm Business Interruption (Dairies)

In addition to Defined Events cover, on certain property types we provide Accidental Damage cover.

Vehicle Cover

The vehicle section of the policy gives you the flexibility of choice between three types of cover:

Comprehensive

Covers you for:

• Theft of or damage to your vehicle
• Liability

It also includes:

• Flat rate premium, giving you the maximum 'Rating 1' discount
• Optional windscreen cover

Third Party Property Damage - Fire & Theft

• Fire and Theft cover
• Liability cover
• Uninsured Motorist benefit

Third Party Property Damage

• Liability cover
• Uninsured motorist benefit

Farm Liability cover

We cover your liability to pay compensation for Personal Injury and Property Damage which arises out of your farm business. 

Other farm cover options

Other farm insurance options are also available, including cover for:

• Personal Accident and Illness
• Machinery Breakdown
• Electronic Equipment
• Transit
• Working Dogs
• Frozen Semen and Embryos
• Theft
• Tax Audit

Laptop insurance

Your laptop is important to you. As laptops get smaller and more powerful, you rely more and more on it to store music or do some work whilst commuting back and forth on the train. Many people have valuable information stored on their laptops but also they are still not cheap and as such, insurance cover is a smart choice to protect you against the risk of theft or damage.

With the UK arrival of the iPad in May 2010, some of the insurers below are also offering iPad Insurance to protect against damage to your new iPad.

Your laptop or iPad could be covered under your house insurance policy so do check your household insurance so that you are not covering items more than once. If your laptop is not covered, compare the market.com has done all the hard work for you. An excellent deal is just around the corner.

Everything you need to know about laptop & UltraBook insurance

When your laptop or your UltraBook has so many precious items on it, like all your photos, bookmarks and documents, it's a good idea to get it insured - just in case. Plus the cost of replacing your laptop is another important reason to make sure you're covered.

However, not all laptop or UltraBook insurance is the same. There's a huge range in price and quality when getting a quote online for insurance. The good news is that Protect your bubble's comprehensive laptop insurance policy takes into account the importance of price as well as quality, in terms of the protection it provides.

Here’s a bit more about our great value cover:

• Accidental damage
  If your laptop or Ultra Book is accidentally damaged, we’ll pay for the repair or replacement costs. So, if you spill coffee over your keyboard or drop it down the stairs, you don’t have to panic*. Or if you forget it’s in your bag and throw it down, it’s not the end of the world.
  
  
  
  
  
  
  
  
  
  
• Theft
  You can’t be too careful these days, so make sure you never leave your stuff unattended when you’re out and about. If the worst does happen though and your laptop is stolen, tell the police straightaway** and we’ll sort out a new one for you.
  
  
  
  
  
  
  
  
• 
  Breakdown
  What would you do if your laptop or Ultra Book stopped working just as you were in the middle of some important work? Our laptop insurance includes electrical and mechanical breakdown cover, so if yours stops working or won’t switch on, we’ll fix it or replace it for you – so you can get on with what you need to do with as little hassle as possible.
  
  
  
  
  
  
  
  
• Worldwide cover as standard
  Whether something happens to your laptop in Barnet or Barbados, you’ll be protected against the costs of replacing or repairing your device wherever you go. So if you’re on your holidays, you can relax even more.
  
  
  
  
• Great value cover 
  Our comprehensive laptop insurance offers better value than many of our competitors. So sign up today and you could be insured in a couple of minutes. After all, it could save you time and money later on. So sign up today .

Cell Phone insurance

You’ve finally settled on the perfect new cell phone with all the latest features. You’ve chosen the accessories and picked a service plan.  Now the salesperson asks if you want to buy insurance to protect your purchase.

It’s only $4.99 a month and you’ll be covered if the phone is lost, drops in the toilet or is run over by a car. So you say yes. Did you make the right decision?

Your new phone comes with a manufacturer’s warranty. But that only covers equipment failure caused by a defect or malfunction. You’re out of luck if the phone is lost, stolen, or accidentally damaged.

Dwight Moore with Verizon Wireless, says customers like cell phone insurance because they know if something happens to their phone, they’ll quickly have a replacement. In most cases, he says, it will arrive overnight and will be“exactly the same or similar” to the one you had.

Why consumer groups don’t recommend it 

“We think it’s almost always a waste of money,” says Consumer Reports Editor-At-Large Greg Daugherty.

“You can insure everygadget in your life if you want these days,” Daugherty says. “We think all this little insurance is just adding up to too much in many cases. People really ought to be focusing on the big risks.”

San Diego’s Utility Consumers’ Action Network (UCAN) also advises most consumers to skip cell phone insurance. UCAN’s Michael Shames tells me they get “lots of complaints” from people who did buy this coverage.

Some complain their replacement phone is used, what the industry calls “refurbished.” Others are surprised by the deductible, usually around $50.

Shames calls that “one of the dirty little secrets about phone insurance.”

Shames says insurance might make sense for some people — those who are prone to drop their phone, get it wet or somehow disable it. “It might be useful if you happen to work on building skyscrapers and you tend to drop your phone 30 or 40 stories,” he says.

It could also come in handy if you’re buying a high-end PDA phone that would cost you $500 or $600 to replace. Just remember, he says, “your replacement phone is likely used.”

An insurance nightmare 

Justin Leavens, a businessman in Sherman Oaks, Calif., is one of those who complained to UCAN.

He purchased insurance coverage when he bought a fairly expensive phone from Verizon Wireless. “My cell phone is my lifeline,” he says. “So I couldn’t really be without it for more than a few days.”

Whenthe phone was damaged, Leavens filed a claim with the insurance company, Asurion, and was told he would have a replacement phone “the next day.” When it didn’t arrive, he called Asurion again and was told they didn’t have his phone in stock.His choices were: get on a waiting list or take a different phone that did not have the same features as the broken one.

Leavens says he suggested comparable phones that would make him happy, but the insurance company would not agree to that. He told them his local Verizon store had his phone. He offered to go pick one up ifthey would pay for it. Again, they said no.

“It really appeared like they were doing everything in their power to get out of paying for my cell phone,” he says.

Totally frustrated, Leavens went to the Verizon store and “basically begged for help.”

To make a very long story short, he says Verizon convinced the insurance company to pay for a new phone. Leavens picked it up right away, but he told me he had to wait 2-and-a-half months for his reimbursement check.

I made several requests for a comment from Asurion, but there was no response to my calls or emails.

The fine print 

When it comes to insurance, it’s the actual policy that counts, not what you see in the colorful brochure or hear in the sales pitch. The policy is a contract between you and the insurance company, and these cell phone policies have numerous limitations and exclusions not spelled out in the sales material.

For instance, the policy for Cingular phones do not cover “normal wear and tear” or a cracked display “that does not affect the mechanical or electrical function of the unit.”  And while the sales brochure promises, “a replacement is just a call away,” the policy is less generous. It says the company has the right to “repair or replace” the phone. That’s a big difference. And if they do send you a replacement, “colors, features and accessory compatibility are not guaranteed.”

Before making a decision, ask fora copy of the actual policy and see what it covers and what is excluded.

What should you do? 

Say no to insurance cover ageat the sales counter. Take some time to think about this purchase. You don’t have to make an impulse decision in the store. Cingular gives you 30 days. Verizon Wireless customers have 15 days to decide.

Consider what you’re really buying. While the transaction takes place through your wireless company, you are actually buying the policy from an independent third-party. If your claim is rejected, the wireless company may not be able to help.

Cell phone insurance is not like homeowners or auto insurance. With these policies if you have a covered loss, you get money from the insurance company. With phone insurance you get merchandise — a phone — instead of money.

And consider this. You can go online and get some great deals on used cell phones. If you lose or damage yours, it may be cheaper to simply buy a new one out of your own pocket with the money you didn’t spend on insurance.

Taking action 

A class action lawsuit filed in Miami claims the insurance companies selling this coverage are using “deceptive and outrageous” practices. The suit contends the refurbished phones people get are worth less than the original phones.

MSNBC.com has learned a preliminary settlement has been reached in this case and will be presented to the court later this week. If approved, the settlement would affect as many as 13 million people who bought cell phone insurance.