Identity theft insurance provides coverage for possible financial damage from identity theft. Identity theft revolves around stealing sensitive information from users affecting their finances and well-being.
Regaining these identities and managing damage caused by theft can cause thousands of dollars on average. There were over 1800+ data compromises in 2021 alone, which cost victims millions of dollars collectively.
Interestingly, most of these identity theft cases are pre-planned, where hackers first make a transaction of a smaller amount. Once they successfully make the transaction and know they have access; they make the actual theft. Fortunately, options like identity theft insurance can help manage expenses and financial damage from these identity theft cases.
How Can You Get Identity Theft Insurance?
Most individuals and organizations fear the risk of data compromise and identity theft. Therefore, they need to rely on identity theft insurance. The following are some ways to purchase identity theft insurance.
Add It to Your Homeowners or Renters Insurance Policy
The best way to do get identity theft is to add it to your home insurance policy. The majority of the people in the US have this insurance policy, making it an ideal way to ensure better protection. It will add a small amount to your premium payments according to the intensity of protection required.
Buy it as a Standalone Policy
You can also purchase it as a separate policy, but you need to discuss the details with a reliable insurance provider. They can explain the details and technicalities of these policies properly.
Check Your Existing Homeowners or Renters Insurance Policy
We also suggest that you check if your homeowner or renters insurance policy has identity theft included in the coverage. Buying an extra policy will only cost you extra premiums, for pretty much the same benefits.
How Much Do these Policies Cost?
Fortunately, most of the identity theft insurance policies aren’t expensive. The average cost of these policies starts from $30 a month, which is quite affordable. However, the actual price of the policy depends on the benefits you wish to gain from it.
Many of these policies provide coverage between $10,000 and $20,000, but the price may differ for insurance providers. Keep in mind that some policies also have a deductibles clause in them. This means insurance owners need to pay a small amount (usually $50 or $100) out of the total insurance claim.
However, the policy providers will take care of the rest of the costs and expenses. This makes it an affordable option to protect you from financial instability against possible identity theft.
What do These Policies Cover?
The coverage criteria for policies differ for several providers, but the general coverage rules are mostly the same. It can reimburse some of the daily expenses that you would bear otherwise, and the identity restoration costs that you bear.
Following are some things that your insurance policy will cover in case of identity theft:
- Child care costs
- Copies of your credit reports
- Credit monitoring services
- Legal fees
- Long-distance phone calls
- Lost wages
- Mailing documents
- Notary fees
Factors to Consider Before Purchasing Identity Theft Insurance
Purchasing identity theft insurance sounds like a great idea, but there are a few things you should keep in mind before making any purchases or decisions.
The policy limits include the amount that your identity theft insurance policy includes when you claim it. This usually ranges between $10,000 and $50,000 for better insurance policies. You wouldn’t want to invest in a policy that doesn’t suffice for your costs and expenses when claimed. So, discuss the policy limits details when you make a purchase.
Deductible amounts include the flat amount that you will pay when you claim insurance coverage. These deductible amounts can cost a lot and make the whole idea of the insurance policy pointless.
Lost Wages Coverage
Users likely miss out on their wages during identity theft. It is because the hackers have access to users’ info and can exploit it in any way desired. You should ensure that your identity theft covers your lost wages, and provides you with a sufficient amount to survive.
Legal Fee Coverage
Reinstating your identity requires documentation and complex processes. Additionally, there are a lot of legal fees at each step of these reinstatements. Your insurance policy should cover all these expenses, to make the process easier for you.
Identity theft insurance is a great way to get financial coverage in case someone steals your personal information. It allows you to file for identity recovery without bearing costs, and you should purchase it if you suspect identity theft.