Identity Theft Insurance - need or not?
News 12 out of Arizona ran an article talking about insurances you don't need. On their list was Identity Theft Insurance. They say that Identity Theft Insurance "does not include unauthorized charges or funds siphoned from accounts." What they recommend you do instead is check your credit reports regularly.
And yet, the federal government has now authorized blanket purchase agreements to two credit bureaus (Equifax and Experian), Bearak Reports, and a company called "Identity Force", to provide policies, using taxpayer dollars, to people whose information is stolen from agencies of the Federal Government.
So who's right?
Well, both are. The federal government is right to realize that they have to take some responsibility for helping people get their information restored, if a data breach on their end results in a person becoming a victim of Identity Theft.
News 12 is right to recommend that you don't buy a policy which simply covers dollar expenses incurred as a result of the loss of your information. They are also right to say that you should check your credit reports regularly. But what constitutes "regularly"? There are three major credit bureaus which alow you to check your credit once/year each for free. Beyond that, you have to pay to check your credit. So, if you were really conscientious, and remembered to check at each credit bureau, you could, at most, check your credit once every four months. So here's the question: Between now and four months from now, could an Identity Thief trash your credit and ruin your good name?
News12 also clearly didn't do their homework with regard to researching Identity Theft and Identity Theft Insurance policies. With the average Identity Theft victim losing over $1600 and 600 hours in the fight to restore their information, you really should have someone to help you through the process. Sure, you could fix the problem yourself, given the right amount of time, knowledge, and resources (which you can get, and you can do yourself), but that would be like fixing your car yourself. You could probably fix your own car, given the right amount of time, knowledge, and resources (which you can get, and you can do yourself), but you generally have the repair person fix your car when it breaks, because it takes them less time, is less hassle for you, and you will know that it's done right if you take your car to a good mechanic.
You can restore your name yourself, but based on the statistics about the average time and money a victim spends, you should plan on taking the next five years' worth of lunch hours to get your information restored, with no guarantees of results on the other end of five years' worth of work.
So if you do need someone to help you through the process, the question is not whether or not to buy Identity Theft Insurance, but which identity theft insurance to buy.
Do you want a policy which covers just some credit monitoring and out of pocket expenses, or would you like a little better solution?
So who's right?
Well, both are. The federal government is right to realize that they have to take some responsibility for helping people get their information restored, if a data breach on their end results in a person becoming a victim of Identity Theft.
News 12 is right to recommend that you don't buy a policy which simply covers dollar expenses incurred as a result of the loss of your information. They are also right to say that you should check your credit reports regularly. But what constitutes "regularly"? There are three major credit bureaus which alow you to check your credit once/year each for free. Beyond that, you have to pay to check your credit. So, if you were really conscientious, and remembered to check at each credit bureau, you could, at most, check your credit once every four months. So here's the question: Between now and four months from now, could an Identity Thief trash your credit and ruin your good name?
News12 also clearly didn't do their homework with regard to researching Identity Theft and Identity Theft Insurance policies. With the average Identity Theft victim losing over $1600 and 600 hours in the fight to restore their information, you really should have someone to help you through the process. Sure, you could fix the problem yourself, given the right amount of time, knowledge, and resources (which you can get, and you can do yourself), but that would be like fixing your car yourself. You could probably fix your own car, given the right amount of time, knowledge, and resources (which you can get, and you can do yourself), but you generally have the repair person fix your car when it breaks, because it takes them less time, is less hassle for you, and you will know that it's done right if you take your car to a good mechanic.
You can restore your name yourself, but based on the statistics about the average time and money a victim spends, you should plan on taking the next five years' worth of lunch hours to get your information restored, with no guarantees of results on the other end of five years' worth of work.
So if you do need someone to help you through the process, the question is not whether or not to buy Identity Theft Insurance, but which identity theft insurance to buy.
Do you want a policy which covers just some credit monitoring and out of pocket expenses, or would you like a little better solution?
