Whether or not you’ve been a victim of identity theft, it's always wise to buy an identity theft protection. It’s better to be safe than sorry.
If the FTC is to believe, 9.3 million individuals fall victim to identity theft every year.
As data breaches and online hacking are regularly making the headlines, people are buying more and more identity theft insurance.
2016 Breaches Identified by the ITRC as of 17.5.2016.
- Total Breaches: 399
- Records Exposed: 12,041,646
Your personal information is a priceless possession. So, you must be extra cautious while purchasing identity theft insurance.
1 Is your insurance company reporting to all the three credit bureaus?
In most cases, the companies offering identity theft insurance do not report to all the three credit bureaus. Rather, they report to one or two of them. Since all your financial records are not equally updated in the 3 credit reports, you may face financial hardships later. So, before purchasing identity theft protection, ask the insurance company whether or not they’re reporting to all the 3 credit bureaus.
2 Is your insurance giving you enough protection?
For instance, if a fraudster takes out a loan in your name and then escapes with the money, your identity theft insurance won’t cover up that loss. It only covers the expenses related to the actions you need to take to get back your identity such as costs for making phone calls, legal bills, and so on.
3 Is there a deductible?
The majority of the identity theft insurance companies has a deductible varying between $100 to $1000. Therefore, if your financial loss is below your deductible, you’ll have to pay for it out of your pocket first. Considering the fact that most identity theft victims spend below $1,500 to get back after identity theft, the insurance may well not be worthy of the cost.
4 Is your credit card offering free identity theft protection?
A few credit cards offer free identity theft insurance. So, if your credit cards offer the same, then it doesn’t seem sensible to pay for identity theft protection from another source.
Also, check out if you have access to “free identity theft protection or credit monitoring through your employee benefits program, credit union or membership in organizations such as AAA.”
5 Is your insurance company providing free identity theft protection?
Do you want being charged a payment for the same service months, or even a year later? Of course not! Some institutions do this and don’t even inform you when you sign up for their identity theft insurance.
6 Is your insurance covering all aspects of your identity?
According to consumer advocates, it’s a bad idea to buy any single use insurance. For instance, you must buy health insurance that gives protection to all aspects of your physical health, rather than purchasing the one that only covers diabetics.
7 Is DIY identity theft protection the best option?
8 Is your insurance company offering fraud alerts?
To ward off identity theft, the clients receive fraud alerts or credit freezes from only some ID theft insurance companies. So, before making any major decision, make it a point to ask about this to the insurance company.
What you need to do is to notify only one credit agency, and that agency will inform the other two.
The agency will call you to check whether or not it’s you who is doing it. On the 91st day, you can set another fraud alert. You can do this consistently with simply a phone call.
9 Do you know the cost?
Purchasing identity theft insurance is worth $25 to $180 a year. If you start taking care of your identity all by yourself, somewhere you’re saving every bit of your precious dollars.
Your identity is as precious as gemstones; so, protect it from the hands of the fraudsters. Remember, your identity is your everything!
- Don’t miss out: Is your child's identity safe?