From digital transactions to interconnected networks, there are several factors that can increase the risk of identity theft for individuals and businesses alike. Experts believe that in 2024, there is a new identity theft victim every 22 seconds.
Whether you’ve recently found out someone has accessed and used your personal information or you want to take preventative measures to protect against identity theft, it’s important to understand what kind of protections are available. In this article, we’ll outline exactly what identity theft is and discuss whether insurance protects against it so you can take the necessary measures to keep your information and finances secure.
What is identity theft?
Identity theft is a form of fraud that occurs when an unauthorized individual acquires and uses someone else's personal or financial information for deceptive purposes. This act allows the perpetrator to assume the identity of the victim, exploiting their personal data for financial gain, fraudulent activities, or other illicit purposes. The stolen information often includes the victim's full name, Social Security number, date of birth, credit card details, and other sensitive identifiers.
Identity theft can manifest in various forms, such as credit card fraud, loan or mortgage fraud, tax fraud, and even medical identity theft. In these scenarios, the perpetrator may open fraudulent accounts, make unauthorized purchases, or engage in criminal activities using the stolen identity, causing severe financial and reputational harm.
Does insurance cover identity theft?
Some home insurance policies include identity theft coverage in their standard policies, but most of the time you’ll have to purchase additional coverage on top of your policy. Identity theft protection is often bought as a rider to homeowners, renters, or auto insurance, but there are also standalone policy options.
What does identity theft protection cover?
Identity theft protection services and insurance aim to provide comprehensive coverage for various aspects of identity theft recovery and financial losses. Here's what identity theft protection typically covers:
Recovery Process Costs: Identity theft protection typically covers expenses associated with the recovery process after identity theft occurs. This may include fees for case managers or identity restoration specialists, legal fees, costs of replacing important identifying documents, lost wages, and costs of placing fraud alerts on credit reports.
Financial Losses: Identity theft protection may reimburse some of the expenses that occur after the theft, such as bank fees, notary fees, lost wages, legal fees, money stolen, credit agency fees, new document costs, specialist fees, long-distance phone bills, postage costs, child care costs, and other financial fees.
Monitoring Services: Identity theft protection services often include features such as dark web monitoring, stolen wallet protection, credit monitoring, and alerts for any unauthorized use of personal information.
How much is identity theft insurance?
The cost of identity theft protection services, which includes identity theft insurance, can range from around $20 to $60 per year, depending on the level of coverage and the applicant. Some policies also have deductibles, which require you to pay a certain amount before your coverage kicks in.
It's important to note that identity theft insurance coverage can vary from a few thousand dollars to $1 million, so you’ll want to review your options carefully. If you’re unsure where to begin, you may want to consider working with a brokerage like SelectQuote for clear guidance and experienced insight.
Secure Identity Theft Protection with Your Home or Auto Insurance with SelectQuote
Whether you’re looking for identity theft protection or want to learn more about the home insurance coverage options available to you, our licensed insurance agents are here to help. At SelectQuote, we can provide quotes from some of the most trusted carriers for home insurance and auto insurance in just minutes, making it easy to explore your options all in one place. For nearly 40 years we’ve helped millions of customers just like you find and secure the coverage they need.
