Identity theft has become one of the major problems the American justice system faces at the moment. Statistically about one in four Americans has been the victim of some sort of identity theft.
There are usually two big cases of identity theft: financial and medical.
Financial identity theft means stealing money from someone’s account or using someone’s account to make purchases without that person’s permission. This can happen if someone steals your credit card or if that person poses information about your banking accounts. If you are the victim, it is possible to get a hold on your account again, but it will cost you a lot of time and you’ll gather a lot o stress.
But insurance owners can also be the victim of identity theft. As medical costs are very high, having a health insurance is almost a necessity as it can save you a lot of money. This makes health insurance a favorite target for criminals who can use your policy to get free medical services.
The main problem is that many victims don’t know that their policy is used by someone else. One day you may find out that your policy has reached its “cap”, the maximum amount that it will cover, although you had no need for medical services. The situation is very unpleasant! On one hand you, can’t use your policy anymore, which makes it the worst time to fall ill, and on the other you’ll have to spend an inconsiderable amount of time explaining your situation to your insurance agency’s representatives.
Insurance identity theft is not restricted only to medical insurance. Why would anyone want to steal your life insurance policy? There is a very profitable identity market that targets illegal immigrants who need some sort of paper to attest their identity.
As identity theft is becoming more widespread, can people protect themselves by purchasing identity theft insurance? This type of policy promises to get your identity back by sparing you the burden to do it yourself. Considering the fact that the ones offering such services are the one that fail to protect your identity in the first place (banks), many experts consider it a bad investment. Also, such policies don’t cover the money that has been stolen from you. Also the cover doesn’t apply if the offense was committed by one of your family members (this happens in most cases).
The best way to protect your identity is to pay your bills online, shred or safely deposit documents that contain your information and keep a clear record of your credit card bills.