A survey by one vendor found that 39 percent of employees want to buy identity theft insurance through their employer. Are you providing this valuable benefit?
Identity theft occurs when someone uses an individual’s personal identifying information—name, address, credit card or Social Security number—without authorization to open new charge accounts, order merchandise or borrow money. When the bills pile up, the thief disappears. Victims of identity fraud lose money, their good reputation and their credit rating, which can hinder their ability to borrow money, buy insurance or find a job.
Dealing with identity theft increases stress levels and hampers productivity. Identity theft victims spend an average of 50 to 175 hours restoring their name and credit history, according to data from California Public Interest Research. Offering your employees identity theft protection can help reduce the financial and physical toll of dealing with identity theft.
Types of Identity Theft Protection
Identity theft protection takes two forms: identity theft insurance, and non-insurance identity theft protection programs. Insurers often bundle identity theft coverage into other types of insurance, including some homeowners insurance programs. Some offer identity theft insurance as a standalone policy available on a voluntary (employee-paid) basis.
An identity theft insurance program typically reimburses victims of identity theft for certain expenses they incur to correct their credit record. These can include phone, notary and certified mail costs. Some policies also provide some coverage of lost wages resulting from taking time off to deal with identity theft. Many cover attorney fees, subject to policy conditions and limits, and offer professional assistance to help plan members restore their credit.
Most identity theft coverage will not reimburse insureds for direct monetary losses due to identity theft.
Non-insured identity theft protection plans typically offer services designed to detect identity theft early and minimize any resulting losses. These include credit monitoring and notification services; some plans also provide reimbursement or coverage for costs of repairing credit records. Some also provide education and other tools designed to help reduce the chances of identity theft. Some prepaid legal plans—available on a voluntary basis—also include services to help members deal with identity theft.
Many programs offer both types of protection: credit monitoring services to provide early detection, and insurance coverage to cover the costs of dealing with and correcting identity theft. We can provide information and enroll your employees at no cost to your organization.
Individuals also have a responsibility to do what they can to protect their finances and credit rating from identity theft. Please share the following suggestions with your employees:
• Protect your Social Security number. Do not carry your card with you and do not provide your number unless necessary. Employers require it for payroll and reporting purposes; lenders and landlords may request it to check your credit report. If anyone else requests your Social Security number, find out how it will be used. If it’s not needed, ask them to use an alternative number.
• Request a copy of your credit reports once a year. Each of the three major credit bureaus must give consumers a free copy of their credit report once a year; request your copy at www.annualcreditreport.com. Check each report for unfamiliar accounts or suspicious charges and dispute them immediately.
• Ask credit bureaus to notify you at a certain phone number before granting credit.
• Pick up your mail immediately. Many identity thieves find personal information in mailboxes. If you will be away, put mail on vacation hold.
• Minimize unwanted solicitations. ID thieves often use preapproved credit card offers to steal identities. To opt out of solicitations, go to www.optoutprescreen.com.
• Shred papers containing personal identifying information or account numbers before discarding.
• Before discarding CDs, hard drives or other media that contain personal information, overwrite them.
• Protect your personal information online. Use virus protectors and firewalls on your computers. Never access personal financial information when using an unsecured wireless network.
• When shopping online, use only secured sites. Look for https in the web address.
• When using a debit or ATM card, do not let others see you enter your PIN.
• If you become the victim of identity theft, don’t panic. The Federal Trade Commission provides very helpful, step-by-step information on what to do.