Credit Monitoring Services & ID Theft Insurance
The following article is from Identity Theft Resource Center regarding credit monitoring services and credit insurance, something I alluded to in an earlier post on ID theft. I wasn't sure that the monitoring services were worth the money --- it seems they're not if you're going to take responsibility for your credit reports yourself. ID theft insurance MAY be worth the investment if you have the right coverage. Make your own determination:
Regarding "Credit Monitoring Services"
The Identity Theft Resource Center does not endorse any products. However, many consumers do ask about credit monitoring services. We have tried several but felt that none fulfilled all our needs. We still prefer to check our credit reports personally. Unfortunately, while most say that they monitor all 3 bureaus, they only do so for the purpose of the first tri-report. Afterwards, they only monitor the one bureau with whom they are associated. In essence, you would have to buy THREE monitoring systems.
The second problem is time lag and failure to place any notice with the bureaus. Companies are not required to notify the bureaus of credit accounts in your name. In fact, most utility companies only report to the bureaus once an account has gone to collection. There is also a time lag by the credit issues in some cases -- between the opening of an account and the notice to the bureau. It could be as long as 2 months according to one person who used these monitoring services.
Given these issues, ITRC does not think that credit monitoring services have met the level of service that we demand. For all practical purposes you can create your own monitoring service using free credit reports will start to be available to all U.S. citizens starting in December 2004. Each person will be entitled to one free annual credit report from each agency. It will be a roll-out program starting on the west coast. In other words, order one bureau this month, a different bureau's report in 4 months, and the third one four months later.
Your reports will always be free if you have been denied credit, suspect you are a victim of id theft or financial fraud or are unemployed and looking for employment.
Having said that, if you want to purchase a service, we think it's best to find a product that keeps you updated on all 3 credit reports on a daily basis. Who knows- maybe a company will eventually offer one at an affordable price (under $50).
ID THEFT INSURANCE: As to id theft insurance, this is a buyer-beware situation. Make sure that they cover most major costs including lost wages and time, travel, legal expenses, postage, photocopying, telephone costs and edical/psychological treatment that may be needed. It should have a low deductible.
This is a personal choice issue. The cost should not be more than $25-40 per year or it may be overpriced. The deductible should be not be high or it doesn't pay for itself. Your highest costs will be time spent, legal costs (if necessary) and travel.