It’s frightening to think how easy it is to become a victim of identity theft now that data breaches have become so common. Unfortunately, identity theft protection services and the marketing of them are built on those fears. While identity theft is a very real threat, the fact, is you probably don’t need to pay for identity theft protection insurance now that there are so many free resources available. Here’s why.
You to Have Pay for Identity Theft Protection Before You’ll See the Value
The value of the identity theft protection insurance policies will depend on which provider you buy from and the specific limits on the policy for what’s covered and when, but many require that you pay out of pocket for losses up to a certain point before the policy pays out. Plus, many identity theft protection providers market the illusion of value with policies that cover up to $1 million in damages, but the typical cost of identity theft is about $1,350 per incident, according to CSID.
You May Already Have Identity Theft Protection
Your homeowner’s insurance policy may include some identity-theft protection, up to a certain dollar amount; it may even provide a case manager to help you deal with the aftermath of identity theft. If your current policy doesn’t include identity theft, you can add an inexpensive rider to it. There are also non-profit groups like the Identity Theft Resource Center, which provide free identity theft counselors for victims of identity theft. Between your homeowner’s insurance policy and non-profit assistance, paying for an identity theft protection policy may not provide any advantage as a line of defense, or recovery.
The Most Popular Fraud Types Are Detectable With Credit Monitoring
Javelin reports that account takeover, new accounts and card not present transactions fuel the majority of identity theft incidents. In all of these cases, you stand a better chance of spotting fraud based on a combination of your monitoring of your own online bank and credit statements, signing up for real-time account activity alerts, and enrolling in the free credit and social security monitoring services that so many banks and credit card issuers and companies like Credit Karma and Credit Sesame offer free of charge.