According to the Insurance Information Institute, victims of identity theft can sometimes spend years trying to fix the damage done by fraudsters. It’s not only a long process but it can sometimes also be an expensive one.
Identity theft insurance is meant to help you deal with costs related to identity theft and fraud. If your identity has been stolen, you might need to spend money on legal help, credit repair or solicitor’s fees to resolve the issue. Some policies even have their own specialists to help victims through the process of undoing the damage caused by identity theft.
What does identity theft insurance cover?
Because identity theft can have far-reaching consequences, it’s hard to tell how much money it will cost you to fix the problem. When you have insurance, these costs are covered so the process is easier.
What identity theft insurance covers varies among policies, so make sure you read the fine print before you sign anything. These are some of the most common services covered:
- Help from a case manager to identify how far-reaching the damage is, so you can take steps to fix it
- Assistance with any audits or hearings connected to the identity theft
- Help restoring credit and deleting mistakes from credit reports
- Reimbursement for a solicitor’s costs, administrative fees or other charges connected to the fraud
- Copies of credit reports
- Day-to-day expenses incurred when trying to repair credit, including things like long-distance calls or mailing of documents
- Lost wages for time taken off work to deal with claims
- Notary costs
- Credit monitoring to identify additional losses
What doesn’t it cover?
Identity theft insurance does not cover the actual financial losses caused by identity theft. For example, if fraudsters use your information to buy products in your name or take a cash advance using your credit card, the insurance won’t reimburse you for that. This is something you will have to figure out directly with your credit card provider or bank.
If you’re working with an insurance provider, they might help you identify these losses and sometimes find a paper trail, but it will be up to you to deal with them.
How to get identity theft insurance cover
If you have homeowner’s or renter’s insurance, you might be able to buy an ‘add on’ for your policy that covers identity theft. This might cost as little as £5 per month, depending on your insurer.
Some home insurance policies already include a basic version of identity theft insurance, though it might only cover legal costs and nothing else. In this case, you might still benefit from extra coverage. If you’re unsure, contact your insurance provider to find out what your current insurance offers and what your options are.
It’s also possible to buy standalone identity theft insurance. This might offer higher coverage or cover instances your home insurance doesn’t. If you have a credit card, you can also contact your company to understand what kind of protection they offer and whether you can buy additional identity theft coverage.
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