A Good Credit Score

A Good Credit Score

Why You Shouldn’t Bother With Personal Identity Theft Insurance

by Paul Wilcox

Personal identity theft has become a lot more newsworthy lately. Some experts say that it’s receiving much more attention than it should. It has become so common in the news that there is now an insurance to cover it called personal identity insurance.

What Does It Cover?

Personal identity theft insurance typically costs $25 to $50 per year and covers up to a total of $15,000 to $25,000 worth of expenses. It covers some lost wages that result from of time that must be taken off work to deal with fraud. Coverage for this benefit usually does not exceed $500 per week and is generally limited to four weeks of total coverage. Some attorney’s fees may be covered by this insurance.

Some insurance may also cover special mailing charges to mail fraud affidavits to the correct people. Fees for credit cards and loans that were applied for and rejected due to false information are at least partially covered.

Long distance bills for calling banks and other merchants and law enforcement agents to discuss the fraud can also be covered.

While this may seem like a good deal for the price, consumers need to keep in mind a few things. First of all, identity theft is very unlikely. In fact the likelihood of being a victim of identity theft is just 0.35%. This makes identity theft a very unlikely occurrence.

The coverage may seem adequate but when actually broken down, parts of it aren’t very useful. For example, the lost wage item sounds good but at $500 a week, it’s not enough to cover what many people would be making. As well it doesn’t consider that many people are unable to take time off from work.

Personal identity theft coverage does not actually fix your credit or criminal record, which is what auto or home owner’s insurance would do. Instead it only helps to pay for the expenses associated with fixing it yourself. Generally, these expenses do not warrant the cost to pay for this policy, as with most cases they do not exceed $1,000.

Are you looking for more information about how to avoid identity theft? Learn more about how to protect yourself from this and other online security threats at the Online Security Toolkit website.

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