My Trip to the Amusement Park Almost Cost Me a Surprise $1,000. Here's Why

Recently, I went to an amusement park with my family and a few friends. Amusement parks can give your credit cards a workout even at the best of times. But on this particular trip, I nearly ended up with an extra $1,000 out of my bank account.

Here's what happened, and the important financial lesson I learned because of it. 

A rough ride leads to a dropped phone

The disaster that almost cost me a fortune occurred when I went on a roller coaster ride with my friend. I hadn't seen her in a while and we were busy chatting as we waited for the ride so I neglected to take my phone out of my pocket before getting on. I thought nothing of it, until the ride came to a stop and the people behind me announced: "Hey, I think your phone fell out over the lake!"

Sure enough, my phone was not in my pocket anymore, and we had indeed sped very quickly over a lake which would have meant that my phone was gone for good. And, my phone, like most people's phones these days, isn't just a phone. It is a late-model smartphone with a $1,099.00 price tag. 

Since I don't like to finance my phones, I paid for it in full. And I did not have insurance on it because I reasoned that I wouldn't lose it due to the FindMyPhone feature and I wouldn't break it because I would keep it in a waterproof rugged case. So, the loss of this phone would leave me out around $1,000. 

Fortunately, it turned out it fell just before the lake and a very nice maintenance person was able to retrieve it for me the next day. But, while disaster was averted, I learned an important lesson. 

Valuable items need to be properly insured 

The lesson I learned was that my phone absolutely needed to be insured because it was an expensive item that was vulnerable to being lost or damaged -- even if I was careful and even if I took precautions to prevent it. 

The cost of insuring the phone (which I have now done) is $13.49 per month. With the insurance, the cost to replace the phone if it was accidentally lost or damaged would be a $149 deductible so I would save about $851 if I needed a new phone and insurance covered it. With premiums coming in so low, if my phone needed to be replaced under the insurance around once every 63 months, I'd break even for the insurance costs. My $851 in savings due to being insured divided by $13.49 per month in premiums shows me that's the case. 

Since phones are carried everywhere and you never know when you'll have one fall out of your pocket at an amusement park, or suffer some other calamity, going without insurance now just seems foolish to me. The monthly cost of a policy is a small price to pay for the peace of mind of knowing you won't randomly have to shell out hundreds of dollars due to an unforeseen incident. 

Of course, this principle holds true for all insurance for valuables, whether it's an expensive engagement ring or your car or your phone. You'll want to make sure you have coverage for things it would be a hardship to replace, especially if you can get the protection at a reasonable price. 

To decide if you need coverage, compare the cost of the premiums versus what it would cost you to replace the item without coverage just as I did above. If you suspect something could happen within the time frame that it would take to break even for insurance costs, buy a policy now before it's too late like it almost was for me.