Monday, July 23, 2007

Identity Theft insurance



I recently received a brochure from my insurance company advertising Identity Theft Insurance. They reprinted this information from the Federal Trade Commission on the most common methods used to steal personal information:
  1. Dumpster Diving. They rummage through trash looking for bills or other paper with your personal information on it.
  2. Skimming. They steal credit/debit card numbers by using a special storage device when processing your card.
  3. Phishing. They pretend to be financial institutions or companies and send spam or pop-up messages to get you to reveal your personal information.
  4. Changing Your Address. They divert your billing statements to another location by completing a change of address form.
  5. Old-Fashioned Stealing. They steal wallets and purses; mail, including bank and credit card statements; pre-approved credit offers; and new checks or tax information. They steal personnel records, or bribe employees who have access.
  6. Pretexting. They use false pretenses to obtain your personal information from financial institutions, telephone companies, and other sources. For more information about pretexting, click here.
I think of myself as being savvy to the ways of the credit card thieves but yet I've had my number stolen twice. I'm pretty sure that it was #2 or #5 both times, as I had to let the card out of my sight and into the hands of unscrupulous waitresses. On the internet, I never give the number to an unsecured site and all my discarded bills and credit card offers/checks are burned in the wood stove. I am also the party pooper at work dispelling all the urban legends at work by sending out the Snopes report for each scam or too-good-to-be-true chain letter I get. Some of these even originate from HR!! Despite these apparent street smarts, I still get my number stolen (maybe I should stop using it for every single monetary transaction 2-3 times a day).

So will this insurance really help? What do they really give you for it? Here is their rundown:
  • $15,000 for resolving identity theft problems, with a $250 deductible per claim
  • Unlimited access for you and your family to a resolution expert via a toll-free number
  • Expert assistance in handling all documentation and phone calls needed to resolve your case
  • Systematic notification to credit bureaus, creditors, collection agencies, government agencies, and all relevant parties
  • Assistance filing a police report, completing a fraud victim affidavit, and creating a comprehensive case file for investigative and claims handling purposes
  • One year of credit monitoring and fraud monitoring for victims
  • Proactive assistance for victims of wallet and handbag theft
  • Up-to-date information and educational resources on how to protect yourself against identity theft crime
This sounds like a whole lot of "assistance" and not much else. Credit card companies completely cover fraud as I'm happy to report, but if someone gets a hold of your bank information, $15k of coverage will not go very far. In my opinion it is just another way to sucker you out of money in a supposedly legitimate fashion.

1 comment :

Bigqueue said...

How true....I guess identity theft isn't such a new thing, but in this age of electronic transactions....it rises to a totally new level of danger.

Mass amounts of money can be taken in the flash of an online password. Tracks can be covered and laundering can be done very quickly by the skilled thief.

I suppose the same thing happened when they invented banks and checks.....but we made it past all of that.

In some ways, it might be best to just blend in with the crowds and let the natural odds (which run in our favor) take control.

On the other hand, it does make sense to take precautions I suppose.

I suppose this sort of insurance is like any other....it's only good if you use it to cover things you can't stand or afford to loose...and then only if it actually covers all that you can't stand to lose. (saving the kitchen makes no sense if you let the bedrooms and bathrooms burn.)

Of course, insurtance is also only worth it if you can afford it....paying all the money you are trying to save to the insurance company you hire to save that money makes no sense at all.

Such is life.....not always easy....

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