What Is Identity Theft Protection?

July 18, 2021

identity theft protection

Identity Theft Protection

WHAT IS IDENTITY THEFT PROTECTION?

Most of us with credit cards receive random calls from credit card or third party companies about Identity Theft Protection. These calls may leaving you wondering: Do I need Identity Theft Protection?

Increasingly we are hearing on news about hackers stealing personal information from retailers and you may think identity theft protection may not be such a bad idea. You may feel that it’s a matter of time before someone gets your information, and it is true that your information could get in a fraudsters hand. However, you have to consider what services are being offered and whether they are really protecting your identity.

Identity theft protection insures you against the costs of identity theft and helps you restore your credit report.

It is important to realize there is a difference between someone getting access to your credit card information and identity theft. Stolen credit card information is very different from stolen identity. Identity theft usually entails fraudsters getting access to information such as your name, date of birth, social insurance number, and your address. While credit card information is basically the credit card number, date of expiry, and card security code.

An important point to understand is that identity theft protection does not prevent your information from being stolen, they monitor your information. Here’s how it works.

Identify theft protection provider will monitor your credit report. After all, fraudsters want your information to use your credit cards or open new accounts with your identity. As soon as someone tries to open an account or take out a loan on your behalf you will be notified that this has happened.

Identity theft protection provider will also monitor your social insurance number. Again if someone tries to use your social insurance number or a financial activity takes place on your name you will be notified. Once your details have been stolen they can be sold on the dark web and identity protection can alert you if it is spotted on the dark web.

Take Steps to Protect Your Identity

If you are not convinced identity theft protection is the right choice then you can take these steps to prevent becoming a victim.

  • Protect your personal details. It seems simple but you would be surprised what people throw in their garbage. Shred your documents. Shredders don’t cost much and provide an extra layer of protection. It is worth the expense even if you have identity theft protection.
  • Review your credit report regularly. You are entitled to a free credit report every year. Make it a habit to monitor your credit report.
  • Protect your PIN. Don’t assume no one is watching you enter your PIN. I always cover the keypad when entering my PIN. Change your PIN periodically.
  • When shopping online, make sure you are using a legitimate website. Phishing is a growing problem and many people fall victim to it.
  • Review your statements every month. Get in the habit of scrutinizing your bank/credit card statements.

While you can follow all these steps and protect your information, there is one threat that you cannot protect yourself from. That is your information being stolen from companies that you use. It is up to the companies to put safeguards against cyber theft. You could do everything right and still have your information stolen.

If the worst does happen, identity theft protection will notify you that this has happened. While it is reassuring to know that you will be notified, you could do this yourself by monitoring your credit report on your own.

At the end of the day, you have to decide if you are comfortable protecting your identity by yourself or if you would like an extra layer of protection. Before you buy this protection, do your homework and find out exactly what is covered and compare the products from different companies.

If you find yourself a victim of identity theft, remember to inform the police and the credit agencies so they can place an alert on your profile.

Recently, I started using VPN (virtual private network). This basically provides an additional layer of protection when you are online by encrypting your data. This is especially important when you are using public Wi-Fi. Public Wi-Fi is not secure and an identity thief with the technical knowledge can steal your details when you are connected to the network. VPN is an additional tool at your disposal to protect your identity.

Keep in mind, Identity Theft Protection does not prevent your personal information from falling in the wrong hands, only you can do that.

 

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