How to Compare Identity Theft Insurance Policies

Today's crimes have taken on a new flavor. In addition to old-fashioned crimes such as property, we now are faced with the prospect of identity theft. Virtually unheard of many years ago, identity theft is common enough where insurance companies, credit card companies and mortgage companies have found a niche in offering coverage to protect individuals from such illegal activity. Here's how to compare identity theft insurance coverages.


Step1 : Compare deductibles. If the deductible is too high, the coverage may not be worth it as the average victim of identity theft spends a little over $800 of out of pocket expenses, according to the Identity Theft Resource Center.

Step2 : Determine how the policy handles attorney's fees. There's the possibility that you may be wrongly sued as a result of identity theft. Make sure the policy you choose covers incurred attorney's fees for defending such suits.

Step3 : Check to see if the policies cover denied credit. Sometimes you may not realize that you've been a victim of identity theft until you apply for credit and are turned down. Find out how your policy responds to reapplying for credit in addition to removing the derogatory items that have accumulated as a result of identity theft.

Step4 : Look at how the policy handles lost wages. According to the Theft Resource Center, it takes an average of 175 hours to rectify problems arising out of identity theft. Although many companies offer non-traditional work hours, you may still have to take some time off from work to deal with organizations such as government offices who don't usually offer such flexible hours.

Step5 : Analyze premiums. If all of the coverages for each policy are identical, it then comes down to purchasing the coverage that's the cheapest.

By : eHow Legal Editor
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