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Look Into Buying Identity Theft Insurance

By Erik Folgate

Last Tuesday, Dateline started a piece about identity theft. They have done segments on identity theft in the past, but this is an ongoing series that is going deep into the life and behind the scenes of identity thieves and the elaborate crime rings going on around the world. I didn’t get to see it, but I am going to try to watch the show this coming tuesday.

Identity theft is the fastest growing crime in America. Approximately 10 million individuals have been affected by identity theft, which is about 3 or 4 people out of every hundred in America. Identity theft is estimated to have cost about $53 billion dollars in money lost. It’s a huge problem, and insurance companies have seen the need that people need to be protected. There are many “flashy” insurance coverages out there like supplemental accident insurance, but this is a supplemental insurance that you NEED to have. The premiums are about the cost of two pizzas per month, so there is no reason not to carry it.

There is some confusion as to what identity theft insurance covers for an individual. It doesn’t replenish the money that is taken from you, because credit card companies and other financial institutions should have policies in place to reimburse you for funds lost due to identity theft as long as you are able to prove it. However, that is the catch. Going through the process of literally getting your identity back, processing inquiries to be reimbursed by credit card companies, and time lost to make a full financial and legal recovery from identity theft costs more time and money than you may think! Identity theft insurance will cover you for your costs incurred to take back your identity, file paperwork, and change important legal documents, identification cards, etc. From what I have heard, you may never make a claim on this insurance coverage, but if you need to, it makes the nightmare of having your identity stolen much less painful.

Here are a list of insurance companies that offer identity theft insurance.

Erik Folgate
Erik and his wife, Lindzee, live in Orlando, Florida with a baby boy on the way. Erik works as an account manager for a marketing company, and considers counseling friends, family and the readers of Money Crashers his personal ministry to others. Erik became passionate about personal finance and helping others make wise financial decisions after racking up over $20k in credit card and student loan debt within the first two years of college.

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  • http://www.techsoapbox.com/ AhmedF

    Oh yeah – this is only going to get worse and worse.

    • http://madsaver.com Mac

      No doubt…I hear more & more stories about this. Just be sure to use hard-to-guess passwords (via LastPass) and keep your vital information private. Still, that’s not always enough. This insurance may be very useful, but I tend to avoid insurance as much as possible, so I probably will never get it. The worst I’ve experienced is having my cc#’s stolen once or twice, but that’s even enough to remedy if caught quickly.

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