Identity Theft Insurance
Can you believe it? Identity theft is getting more and more popular: cases of this crime topped more than 16,000 in 2002. I'd hate to think of how many cases there have been since then.
Typically, identity theft insurance provides money for costs associated with phone bills, lost income, and the costs of a lawyer or notary. Unfortunately, it just doesn't go far enough, because if your identity has been compromised, all kinds of things may have happened. It's not just your credit report.
Often the thieves will take out credit cards in your name. You aren't responsible for this kind of debt. However, another favorite ploy is to use your "stolen" identity to take out a new mortgage on your home. This tends to happen more to older couples, who have had the chance to substantially pay off their homes. Well, here is some really scary news: some courts have upheld these bogus mortgages, and said that the homeowner had to pay them off!
Crazy. Our laws haven't kept up with the creativity of the crooks.
And where does your identity theft insurance leave you if you've got it? It leaves you paying a mortgage that you didn't take out, where the thieves took the money and ran. At that point, having a repaired credit history isn't a great consolation.
I think identity theft insurance should cover the full costs of a "stolen" identity if this is going to be offered. Covering my phone bills and leaving me holding the bag on a mortgage is hardly worth the cost of the premium.
Want to protect yourself? Save the money on the monthly insurance payment and buy yourself a good paper shredder. Put everything through it that has your name or other identifying information on it. And don't put out your garbage or recycling out at the curb until the morning of your pickup.