If you spill water on your iPod or drop it in the toilet, you’re out of luck: Apple’s warranty doesn’t cover water damage. The rules about what counts as water damage may have gotten more lenient recently, however.
Apple’s iPods have a Liquid Contact Indicator inside the headphone port, and if water comes in contact with [...]
Source: http://www.wired.com/gadgetlab/2011/02/apple-technician-ipod-water-damage-policy-revised/
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