Combatting Identity Theft
It was only a matter of time until we started seeing identity theft insurance. Nine million people were the victim of identity theft last year, making this a not uncommon problem. While I'm normally a bit cynical about supplemental insurances above and beyond the traditional home, life and car insurances, for some people, this might turn out to be a wise purchase. On average, policies run between $25 to $50 per year. Both Traveler's and Allstate, among others, are offering such policies in some states. Payout, should you need it, is designed to cover the costs of digging yourself out from identity theft, and is generally used for expenses such as legal fees, notary fees, long-distance phone calls and postage, and lost wages during the time it takes to fight the theft. Some experts say that it takes, on average, about 200 hours of work to "undo" the results of an identity theft.
The states and the federal government could do more. Only two states, California and Texas, allow you to "freeze" your credit the moment you find out your identity has been stolen, which means that potential thieves cannot open new credit cards, credit accounts or checking accounts in your name. Problem is, neither can you, until the situation is resolved. However, it seems a small price to pay to prevent your life from being ruined, or at least seriously damaged. Not surprisingly, consumer goods companies are against any federal laws giving consumers the right to make such a credit freeze. Apparently, it might interfere with their ability to sell you more crap you don't need and can't afford. (At this time, 20 other states are considering legislation to allow consumers to freeze their credit.)
The Identity Theft Resource Center, a non-profit group dedicated to fighting identity theft, has a test you can take to see if you're at risk for having your identity stolen. I figured I would do pretty well on the test. Turns out I'm a disaster waiting to happen. Take the test yourself, here: http://www.idtheftcenter.org/idthefttest.shtml
Some experts say the best purchase you can make to protect yourself from identity theft it to buy a shredder. If you have a fireplace, burn all your sensitive personal papers. Apparently, identity theives are also great garbage pickers. Also, keep an eye on your mailbox: according to research firm Javelin Strategy & Research, 8 percent of identity theft incidents start because of stolen mail. Finally, and this is one I'm guilty of, don't carry your social security card in your wallet. If your pocket is picked or your purse stolen, you've just put your social security number into the hands of a thief. Memorize your social security number and put the card someplace safe: in a safety deposit box, for example.
The Web site of the above mentioned research company, Javelin Strategy & Research, contains a wealth of information on the topic; it's worth your while to take a few minutes to browse: http://www.javelinstrategy.com/
Related Tags: identity theft, social security, identity, theft, credit, stolen
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