Is identity theft insurance worth the money? Before one decides to purchase identity theft insurance, here are a few facts to consider. The US Justice Department estimates that there are approximately 3.6 million victims a year. Of course, all insurance companies of any kind of insurance are all hoping to turn a good profit, that is just good business from their point of view and identity theft is the latest in the offing. Public news can present public panic. That is why it would not be a good idea to buy the insurance just out of fear.
Consider the statistics. “Typically not worth the money” according to Consumer Reports Magazine. Although most coverages can cost somewhere between $200 to $1,000 a year, the buyer needs to keep in mind that the coverage DOES NOT protect you from having the actual theft of our identity stolen.
The insurance is limited in what it will cover. Typically, the insurance will pay for phone calls, cost of gathering or mailing documentation necessary to the recovery. IT DOES NOT COVER MONETARY LOSSES! Some policies do not cover loss of wages or legal fees while trying to recover your losses.
According to The Federal Trade commission approximately 9 million Americans a year are victimized by identity theft, however the majority involve only stolen credit cards, not complete identity theft. Most major credit card companies like American Express, for one, have a system of assistance in place for the card-holder, should the card be lost or stolen and it is free!
The Federal Trade Commission estimates it spends under $1,500 to typically recover for the average victim.
To self-protect from identity theft always do the following:
1. Guard all your personal information. Driver’s license, SS card, credit cards, any and all
important documents that contain any of your personal information.
2. Obtain a free yearly credit report and check for any accounts opened that you know you did not open. You can get your free annual credit report at www.annualcreditreport.com Be sure to check thoroughly your monthly bank statements and credit card statements looking for any expenditures you did not make.
3. Always shred any old pertinent papers related to personal information when you do not need to have them in your possession any longer. Even outdated material.
In the end, it is an individual decision as to the buying of identity theft insurance. If you do decide to purchase it, just inform yourself first. Talk to your agent/seller so that you know exactly what you will be getting (or not getting) for protection in the event you become a victim of identity theft.