Mobile phone owners will no longer have to face huge bills if their handsets are stolen under a deal between the Government and four of the main suppliers.
EE, Three, Vodafone and Virgin Media say they will put a cap on the amount they will charge customers.
The amount is expected to be in the region of £50, about the same price at which a stolen credit card is capped.
The companies have also agreed to halt unexpected mid-contract price rises and allow customers to break their contract if such charges are brought in.
Telecoms providers Sky, BT and Talk Talk have also signed up to the scheme.
Culture Secretary Maria Miller announced the measures as she accompanied Prime Minister David Cameron on his trade trip to China.
"We are ensuring hard-working families are not hit with shock bills through no fault of their own," she said.
"Families can be left struggling if carefully planned budgets are blown away by unexpected bills from a stolen mobile or a mid-contract price rise.
"This agreement with the telecoms companies will deliver real benefits to consumers and help ensure people are not hit with shock bills."
The deal comes on the heels of the Government's proposals to end roaming charges - the costs associated with using mobile phones abroad - within the EU.
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