Generally, if you register each dongle on their site before deployment, then they will offer to replace it. If you didn't, they will make you buy a new one.
About March/April last year we had a faulty dongle and after phoning Steinburg up they said if I sent the dongle back to them, they would send a replacement through. I only had to include the dongle, a letter stating the problem with the reference number and send it recorded delivery. All I had to pay was for the Proof of Postage.
This was the full version of Cubase, so not sure if that makes any difference?