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Identity Theft Insurance

Wednesday, 15 September 2021

“Identity theft is not a joke, Jim. Millions of families suffer every year,” the beloved, quirky character Dwight Schrute so adamantly asserts. Even though identity theft and fraud are increasingly digital in nature, our friend does have a point and the facts are staggering. While there are plenty of things you can do to actively prevent identity theft, did you know that identity theft insurance is also a key component of your home, tenant, or condo insurance policy? This blog will give you some tips on how to protect yourself from identity theft, and how identity theft insurance coverage can help you get your life back to normal if it happens to you.

What Is Identity Theft?

To start, let’s clearly define identity theft. It is when a person steals your personal information, such as credit card numbers, or social insurance number and often uses it for financial gain or criminal purposes.

With your information, scammers could be able to access your computer/email, access your bank accounts, apply for loans, purchase goods and services, disguise their criminal activities, or even get passports or receive government benefits. As they take advantage of your information, your credit score, finances, and ability to get loans, travel, buy a house, could be severely compromised.

Identity theft can be achieved through simple means such as dumpster diving and mail theft, or it can be more sophisticated with the use of phishing, database breaches, computer malware and viruses.

For some examples of current scams in Canada, visit the Canadian Anti-Fraud Centre’s website.

Identity Theft Insurance: The Risk in a Digital World

As we spend more of our time interacting digitally, the threat of cybersecurity risks continues to rise. In Canada, police-reported identity theft nearly doubled from 2019 to 2020, and identity fraud increased by 2.5 times in 2020. As we see an increase of digital use overall, we can expect these numbers to continue to rise. The Canadian Anti-Fraud Centre reported that from January 2021 to July 2021, there were 46,077 reports of fraud, resulting in combined losses of $130 million dollars lost to cunning fraudsters. What’s more is that they estimate that only 5% of all fraud is reported to them.

Identity Theft Insurance Coverage

The good news is that several property insurance policies might include coverage that would protect you from financial loss if you were a victim of identity theft – and you can often see about increasing your coverage.

Identity theft insurance coverage often has a policy limit (e.g. $30,000). These funds are dedicated to helping you recover your identity and may also cover financial losses experienced if you succumb to a scam. Identity theft insurance coverage usually provides an insurance case worker who would be assigned to your claim and guide you through the process. It’s also possible that your coverage will also include credit monitoring and credit bureau reports for a set time.

As always, policies vary depending on what you’ve purchased. Always reach out to a BIG insurance broker to get a clear answer about whether you have identity theft insurance.

How To Know If You’re a Victim & Need to Make an Identity Theft Insurance Claim

It’s very possible for identity theft to happen without you even knowing. Someone might discover they are a victim of theft when they are denied a loan, mortgage, or apartment because of a poor credit score. Here are some other signs that you’ve been a victim of identity theft and should make an identity theft insurance claim:

  • Your bills and statements no longer arrive when they should, or at all. (Stolen from physical mailbox, email hacked, or a scammer changed your mailing/email address on accounts)
  • Receiving calls or notices from collection agencies or creditors for an account you don't have
  • Getting notification from your bank, credit card, or online business about a new account in your name or added charges.
  • Your bank account or credit card statements show withdrawals or transfers you didn't make.
  • A creditor calls to say you've been approved or denied credit that you never applied for.

What to Do If You Are a Victim of Identity Theft

If you are in fact a victim of identity theft or fraud, follow these six steps to get your life back on track:

  1. Stay calm and gather any information you have about the fraud (documents, receipts, emails, text messages)
  2. Contact your financial institution to flag your accounts and change your passwords.
  3. Contact the fraud to both credit bureaus (Equifax & TransUnion).
  4. Report the incident to the police. Keep the police report number in case you need to report further suspicious activity.
  5. Report the Anti-Fraud Centre and they will provide direction based on the type of fraud/theft you’ve experienced.
  6. Inform your insurance broker – they’ll advise you of whether to make a claim and get you connected with a case worker who will help you recover your identity.

How to Prevent Identity Theft

There are several steps you can take to prevent identity theft at home, while out shopping, or online. Ultimately, you should avoid sharing your personal identifiable information with anyone except for trusted people or businesses. Here are some basic principles to protect yourself from falling victim to a scam.

  • Take extra caution when you receive any unsolicited emails, text messages, telephone calls or mail that asks you for personal or financial information. Be wary and check with trusted sources before you click, call, or respond in any way.
  • Check your credit reports at least once a year and review your bank and credit card statements frequently and report any irregularities.
  • Shred personal and financial documents (including pre-approvals that come in the mail) before putting them in the recycling.
  • Retrieve your mail on a regular basis to mitigate the possibility of mail theft. If you’re away for more than a few days, ask a trusted family member or neighbour to check while you’re away.  
  • Notify the post office and your relevant financial institutions and service providers if you are moving.

For a more comprehensive list of ways to prevent identity theft, visit the Ontario government website.

 

It’s unfortunate to live in a society where we must be skeptical of everything we hear and see, but it’s better to protect yourself and avoid the stress of identity theft happening to you. Property insurance is so much more than just protecting your physical dwelling and your stuff, it protects your identity, too! Contact a BIG broker to learn more about identity theft insurance coverage, or if you’re ready to save BIG on your property insurance, get a quote now.