According to some of the latest reports, law enforcement agencies are having an increasingly tough time when it comes to solving identity theft crimes and clamping down on the tech-savvy perpetrators. Police across the world typically have limited resources at their disposal to tackle a crime that is a characteristically resource-intensive one to solve. As the criminals become more sophisticated in terms of their methods and use of technology, there are fears that the gap between them and law enforcement is widening at an alarming rate.
Identity Theft Insurance – A New Craze
Insurers specialising in identity theft insurance are cropping up all over, and their policies sit alongside traditional insurers who have now added identity theft insurance to their portfolio of other insurance products. Such insurers promise to reimburse victims for the costs of restoring both their identity and their credit status, following the fraudulent use of their personal details. Those costs can include wages lost from time taken out of work, phone calls made to rectify the situation and legal fees. According to one such insurer, the International Insurance Group (IIG) Inc., it takes an average of 200 days to restore an identity and the average expense is $1,600. Insurers promise to take the hassle out of recovering an identity and often promise to do so quicker than a potential victim could do themselves. Some even go a step further and provide identity theft software for computers and internet. ‘Lifelock’ is one of the latest companies offering ‘the most advanced Identity Theft Protection system available’ and promises to spend up to $1million ‘recovering your good name’. It would be hard to turn down such grandiose promises for $10 a month or less.
Is Identity Theft Insurance Really Worth It?
In short, identity theft insurance doesn’t do anything for an individual that they couldn’t do themselves. Banks will refund any money fraudulently taken from bank accounts anyway. It’s a matter of good and responsible practise to check bank and credit card statements every month. If there are any anomalies, regular checking will mean they are spotted quickly and can be dealt with swiftly. It is also widely advised that individuals check their credit report regularly via trusted credit-checking agencies and look for any unfamiliar accounts. It’s also worth cross-referencing what identity theft insurance covers that isn’t already covered by existing insurance policies and consumer agreements. For example, American Express makes identity theft assistance available to all cardholders free of charge.
How Much of a Problem is ID Theft Anyway?
Estimates of identity theft incidences tend to vary wildly. According to the Federal Trade Commission, approximately 9.3 million American individuals are affected every year. The US Justice Department recently calculated that around 3.6 million households were victims each year. In the UK, an estimated 100,000 people are victims of identity theft every year, which has cost the UK economy £1.7billion.
For such a small cost per month, it seems that identity theft insurance is something that worried consumers are taking out to err on the side of caution, even if they don’t fully know what they are buying and whether it’s actually worth anything to them. Ironically, it’s probably those shrewd individuals who do keep a close eye on their bank accounts anyway who are taking out identity theft insurance, while those who find it more difficult to keep track of their finances are taking neither measure.
Simply put, individuals should do their homework. Research different identity theft polices and find out whether personal and home insurance arrangements already cover some aspects of identity theft protection, or can be extended to do so. Also make a point of finding out what identity theft assistance banks and credit cards offer as a matter of course. It always pays to be clued-up and if individuals already know what they are covered for and where, it will make tackling any identity theft issues in the future that bit more seamless – whether or not an individual has taken out identity theft insurance.
Sasha Arms - After graduating from university with a degree in Geography, Sasha became Managing Editor and Travel Editor of Futurespace Magazine. She ...
