October 14th, 2013

Protecting Yourself From Identity Theft Recovery Costs

 

Protecting Yourself From Identity Theft Recovery Costs

**Today’s guest post is contributed by Carrie and Samantha.**

Fires, high winds and other natural disasters can devastate your home and your finances – that’s why you have home insurance. Standard policies protect you from those and other perils. But another disaster also can affect your financial well-being and, ultimately, your home. Identity theft doesn’t ride in on a storm or spring to life like a fire. It strikes silently – you’ll suffer most of the damage from it before you know it. Unless, of course, you’ve taken precautions such as purchasing identity theft insurance.

How prevalent is identity theft? Javelin Strategy & Research reported 12.6 million instances of identity fraud last year, with about $21 billion being stolen. When criminals get your personal information, they can strike quickly, running up big bills, ruining your credit score and making it hard for you to get credit, obtain loans or even find employment.

Recovery from identity theft often is a long and frustrating process – reversing the damage can take years. Many insurance carriers offer identity theft insurance – either as an endorsement to your home or renters insurance policy or as a stand-alone policy – to help make the road to recovery a bit smoother.

What’s covered- and not- with identity theft insurance?

A common misconception when it comes to identity theft insurance is that it reimburses you for the money that was stolen. In reality, direct monetary losses are not covered with identity theft insurance. That means, if the criminal who stole your identity blew $5,000 at Nordstrom and then bought a Maserati, identity theft insurance will not reimburse you for those losses – although in many cases banks and credit card companies do limit how much you can lose.

Instead, it helps pay your expenses for regaining your identity. Some of these expenses may include:

  • Reimbursement for medical ID fraud expenses
  • Travel expenses
  • New identification cards
  • Tax ID fraud-related costs
  • Lost wages
  • Attorney’s fees

Some policies also include guidance and resolution services from a consumer fraud specialist who will help you through the process of restoring your identity.

What are the coverage limits?

While identity theft insurance coverage can vary from policy to policy, most policies offer $15,000-$25,000 worth of coverage for a particular claim. A standard identity theft insurance policy typically does not carry a deductible, meaning you won’t have to pay anything out-of-pocket before your policy starts to pay.

Premiums obviously vary with the amount (and type) of coverage you purchase. Some homeowners who purchase a premium homeowners insurance policy will have this coverage included at no extra cost. For others, most insurers will offer this coverage for as little as $25-$50/year. At $4/month, most consumers consider this a no-brainer financial product.

Questions to ask when purchasing identity theft coverage

As with any financial protection product, it’s important to understand your policy. Here are a few key questions to ask your insurance agent when comparing various identity theft insurance policies:

  • What is the monthly/annual premium and can this be bundled into my homeowners or renters policy?
  • What are the limits for coverage under this policy?
  • Is there a deductible?
  • Does the policy include support from a credit repair specialist?
  • How quickly are claims typically processed?

The big key is understanding that identity theft is real; about 11.6 million fall victim annually, according to the U.S. Department of Justice. Take measures to protect your information from being taken and protect your finances – and reputation – from being damaged.

This article was contributed by Samantha Alexander and Carrie Van Brunt-Wiley, contributors to the HomeInsurance.com Blog. The HomeInsurance.com blog serves as a resource center for insurance consumers and homebuyers across the country.

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Disclaimer: All information posted to this site was accurate at the time of its initial publication. Efforts have been made to keep the content up to date and accurate. However, Credit Karma does not make any guarantees about the accuracy or completeness of the information provided. For complete details of any products mentioned, visit bank or issuer website.

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August 6th, 2013

4 Easy Tips to Help Protect Your Identity While on Vacation

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Summer travel is in full swing and many of us are getting those last minute trips in before the sun sets on summer. While vacations are about relaxing and being stress-free, they can also leave us more susceptible to identity theft. It continues to be the fastest growing crime in America. According to the credit bureau TransUnion, every minute 19 people fall victim to identity theft. How can Americans keep their personal information from being compromised while getting some much needed R&R? Here are four easy-to-follow tips that can help you better protect yourself while on vacation.

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March 6th, 2013

What to do if You’re a Victim of Identity Theft

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Up to this point, all of our National Consumer Protection Week blog posts here at the Credit Karma Blog have covered ways to help protect you. First, we mentioned some ways to keep your money safe. Then, we discussed how to spot and avoid credit repair scams. Finally, we shared some good ways to protect your credit. This post is going to be a little different. And we sincerely hope you won’t need to read it, because today we’re going to talk about what to do if you’re a victim of identity theft.

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March 5th, 2013

5 Things You Can do to Protect Your Credit

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So far for National Consumer Protection Week we've covered 4 Ways to Keep Your Money Safe and How to Spot and Avoid Credit Repair Scams. Today we’re talking about what you can do to protect your credit from things like fraud and errors. Read on for five of our best tips.

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October 15th, 2012

Lisa’s Pre-Internet Identity Theft Story

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When I started college, the internet wasn't the machine it is today. You couldn't apply for a credit card online. It could only be done over the phone, via snail mail or on a college campus, where credit card companies would set up tables and advertise to new, wide-eyed college students. Sure enough, I was one of those new college students who knew nothing about credit cards, and I applied for my very first card.

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September 19th, 2012

5 Facebook Privacy Tips to Prevent a Burglary or Fraud

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Facebook connects more than 800 million people across the globe. But the world’s largest social network can sometimes leave users wondering if their connections are putting their security at risk. There are strategies you can take to limit your vulnerabilities to a burglary or theft. By using sound judgment and enabling Facebook’s advanced security layers, you can better protect your privacy and limit what others see and know about you—particularly those unsavory types. Follow these five tips to stay safe on Facebook and other social media sites:

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September 7th, 2012

Why You Should Check Your Credit Report – Jim’s Story

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The experts always advise that you check your credit reports regularly because you never know when someone may steal your identity or the credit bureau messed something up on your report. The statistics are not on our side.

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May 2nd, 2012

Do You Need Identity Theft Insurance?

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You might think it can’t happen to you, but it happened to 11.6 million American adults last year alone. In 2011, reports of identity fraud were up 13 percent from 2010. This increase might have you wondering if you should start paying for identity theft insurance. But is it worth it? Let’s take a look at the ins and outs of identity theft insurance.

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April 27th, 2012

The Ultimate Guide to Credit Karma, Part 7: Free Credit Monitoring

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Credit Karma’s brand-new free credit monitoring is, by far, our most popular feature (after free credit scores, of course!). Announced in January of 2012, daily credit monitoring can help you protect your credit and identity. And best of all, it’s free at Credit Karma.

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March 30th, 2012

Is Credit Karma Safe?

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Here at Credit Karma, we value our members’ security above all else. We recognize that consumers are concerned about their safety and the safety of their personal information, which is why we take every measure to ensure security.

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