if you buy your device on your amex card either in full or through a carrier with a lease option that is PAID in full, amex WILL extend the warranty.......so if there is a problem during Year 2, any balance due on the iPhone must be PAID in order for Amex to extend the warranty and accept a claim on an iPhone
if you have paid in FULL for an iPhone, it is covered ONLY for the amount that has been paid on the amex card, any credits or non amex payments will NOT factor into the claim amount IF there is a claim during Year 2 with the iPhone
if you are on a monthly plan such as NEXT/EDGE and pay each month on your amex card, the iPhone will NOT be covered in Year 2, UNTIL you pay in FULL.....once it is paid, the iPhone is FULLY covered up to the amount paid on the amex card
this is all subject to change at any time, as of today, this is the deal