An identity theft insurance policy helps victims recover from losses caused by identity theft. It may be offered as a standalone policy or as a benefit of other types of insurance or identity protection plans.
Insurance policies for identity theft do not all offer the same level of coverage. It’s important to understand the types of losses identity theft can cause and what identity theft insurance policies can cover if you’re considering identity theft insurance. Remember: for more tips on how to improve the quality of your life, visit www.credithealing.org.
How Identity Theft Creates Loss
Your identity can be stolen in many ways. The criminals may attempt to gain access to your bank account information, Social Security number, and other personal information. This information could be used to open credit cards in your name, empty your bank accounts, take out fraudulent loans, receive medical care, and more.
Fraud cost consumers over $3.5 billion in 2019. The losses don’t just come from stolen funds. Some identity theft victims may incur thousands of dollars in out-of-pocket expenses, such as hiring attorneys or consumer fraud specialists, replacing stolen identification, filing civil lawsuits, and participating in criminal cases. According to the extent of the fraud and the steps needed to resolve it, costs can range from minimal to exorbitant.
As they focus on recovering their identity, victims can also experience lost wages or other financial consequences as they deal with identity theft.
What Identity Theft Insurance Can Cover
Fraud victims can recoup losses caused by identity theft by purchasing identity theft insurance. Fraud-related losses can be covered by policies, as well as out-of-pocket expenses, such as attorney’s fees. A standalone policy or one that is included in a larger policy can be offered.
In addition to providing some level of coverage for lost or stolen cash and credit cards, homeowners’ and renters’ insurance policies may not cover any expenses or losses associated with recovering from identity theft. Standalone policies cover a variety of things, depending on their terms.
Shortly, identity theft insurance policies may only cover initial losses, or they may cover subsequent costs as well. To ensure you’re getting the right level of protection, it is important to review your policy carefully.
Is your personal information on the dark web? Make sure your identity isn’t at risk!