Why Personal Identity Theft Insurance Isn’t Worth It
Personal identity theft has become a lot more newsworthy lately. Some experts state 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?
The insurance itself generally costs about $25 to $50 per year and covers from $15,000 to $25,000 of costs including lost wages from time to taken off from your job to deal with the fraud problem. Coverage for job loss is usually capped at $500 per week for a maximum of four weeks. This insurance might also cover some legal fees.
Some personal identity theft insurance coverage may extend to notary and certified mailing costs for filling out and delivering fraud affidavits to the parties involved. Fees for reapplying for loans and credit cards that were turned down due to erroneous credit information are usually covered to a certain extent by this type of insurance.
Any long distance charges to banks etc. to discuss the fraud can also be covered.
While this might 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 might 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 doesn’t fix your credit or criminal record as home or auto insurance might do. It strictly helps with the expenses so you can fix it on your own. The expenses entailed generally don’t surmount $1,000 so you might find that purchasing a policy is of no benefit.