• WHAT: A little peace of mind
• WHY: Electronics are expensive and can fail easily
• COST: Varies, but from $6/month for total coverage on expensive devices

On a short stroll a few weeks ago with a couple of charming young adults (they hate being called "kids") I rediscovered how easily they can be influenced. Hannah and Sophie are engaging, bright and frighteningly articulate for their age (pre-teen and early teenager). 

This prompted me to think that they didn't have much in common with the rest of the gossip-swapping, text-sending, Hannah Montana-following world in which I imagined most people their age live. Yet, despite their above-average intellect - or maybe because of it - they were fascinated by some of the apps that I keep on my iPhone.

I'm an admitted info fanatic and so my iPhone is filled with reference materials ranging from copies of the U.S. Constitution to a collection of news sites (which I'll be reviewing in a later post), access to Wikipedia, a comprehensive dictionary and much more. In short, things that you'd not expect a couple of kids to find intriguing for their own use, but Hannah and Sophie did.

These sisters are unusual in that neither has a cell phone and, moreover, seemed amused at my stunned gaze after they told me that they just didn't need one. But, all the same, the lure of the siren's screen overpowered Hannah so she rounded up her saved pennies and bought a used iTouch.

I sell plenty of used electronics on eBay. Whenever I upgrade - which is, lamentably, all too often - I sell my old gear there, thus keeping the stuff out of landfills and making a few bucks to offset the cost of my gizmo habit. When I do this I guarantee the performance of the item for the first thirty days with a no questions asked, money back guarantee (thus my 100% positive rating). That notwithstanding, I do suggest to the buyers that they invest a few bucks in a warranty to protect themselves and would have suggested that to Hannah, too. Turns out she would have needed it.

The iTouch that Hannah purchased was probably sold by a reputable individual or dealer. All the same, when you're purchasing a product that is either out of warranty or with a warranty that can't be transferred, a third-party warranty can bring a little peace of mind and, occasionally, save some money. I'm not a big fan of the "extended warranties" sold by most of the electronic stores that offer coverage beyond the original warranty period - for the most part they are overpriced and unnecessary.

But occasionally lightning, or its more miniscule earthbound counterpart, static electricity, strikes - literally - and that's the ball game. Hannah's iTouch fell victim to a combination of dry winter weather, wool sweaters and rugs… in one depressing moment a static charge morphed her iTouch from a new toy into a paperweight.

A cottage industry of third-party warranty providers has sprung up to address the eBay/Craigs List purchasing habits of Americans like Hannah. While there are several to choose from I've used one, SquareTrade, during the past several years with a high degree of confidence. I haven't had the occasion to make a claim on any of the warranties I've purchased but many others have and the independent opinions about them on sites like ePinions and Nextag are replete with praise about their flexibility, speed and ethics in keeping their promise.

Third-party warranties can cost more than you might be willing to pay so they're not for everyone, or for every purchase, but if you're the type who needs a little extra confidence (albeit at a price) to help you sleep more soundly this might be a solution for you.

The SquareTrade process is simple - you purchase a warranty from them for your item (quotes are available for everything from iPhones to toasters). If something goes wrong with it you contact them and they send you a shipping label for you to send it to them. Once they've received the item and verified your claim you get the replacement amount paid to you.

As an example, you can purchase a full warranty for a new 3G 16GB iPhone that covers normal wear-and-tear plus spills, drops, the death of the internal battery, etc., for $6/month - coverage unavailable from Apple or many others at any price. And if your phone bill - or dependence on your phone - is anything like mine, paying $6/month for complete coverage is a pittance knowing that whatever happens you'll have a new unit at no additional cost (there's a $50 deductible if the damage was caused by a drop or spill but that's a far cry from $500 to replace it).

Hannah's iTouch would have cost about $25 to insure for the first year, which might have been too much for a $200 item, but like all insurance it doesn't feel worthwhile unless you need it.  I hope that none of you (or I) need the security an additional warranty can bring during the upcoming year, but if you do it's nice to know that the option is available.  Hannah can testify that it might be advisable.