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How to choose an identity theft protection service that's right for you and your family

There are important points to keep in mind before making a choice

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(Image: © Robinraj Premchand from Pixabay)

Identity theft is a growing problem that can affect anyone. Thankfully, there's an ever-increasing list of identity theft protection services available to help you protect your identity better. These services can include some combination of identity monitoring, credit monitoring, identity recovery, and identity theft insurance at price points that vary, depending on the features.  

Identity theft occurs when an individual or criminal enterprise steals identifying information about someone and uses it to commit fraud. This data can include names, social security numbers, birthdays, addresses, bank account information, etc. This information is then used by criminals to illegally open financial accounts in a victim's name, steal retirement benefits, purchase real estate, and more.

As previously noted, identity theft is a growing problem.  In 2021, 5.7 million fraud reports were filed in the United States, valued at more than $5.8 billion. One-quarter were specific to identity theft, which saw a 113% increase year-over-year.

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identity theft scanning

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What do identity theft protection services do? 

Protection services are crafted to prevent identity theft, alert the customer that identity theft might have occurred, or assist with identity recovery. 

  • Identity monitoring services scan the web and online databases for subscribers' personal information such as Social Security numbers or email. When this information is part of a reported data breach, the subscriber gets notified and is given suggestions on what to do. In most cases, identity monitoring services serve as a preventive measure. 
  • Credit monitoring services give customers quick access to their credit reports and credit scores using various online tools, both free and paid.  This gives subscribers a bird's-eye view of their financial accounts, making it easier to identify problems after they occur.
  • Identity recovery services can assist victims after a crime has occurred. These companies can help with freezing credit reports, draft letters to creditors indicating theft has occurred, and contact law enforcement as needed. 
  • Identity theft insurance is designed to reimburse victims for any monies spent on reclaiming their financial identities and repairing credit reports. They often aren't necessary, however. 

Points to consider when looking for a identity theft protection service 

There are different points worth exploring when deciding on an identity theft protection service that's right for you. 

Remember there are THREE credit bureaus

There are three independent credit bureaus in the U.S., Experian, TransUnion, and Equifax. Each offers regularly updated credit reports and credit scores, although this content may vary slightly by the bureau. When looking for an identity theft protection plan, ensure it offers access to all three bureaus. Many basic programs do not, which is something to keep in mind. Only by having real-time access to your credit reports from all three companies will you be able to uncover all potential problems.

Take advantage of the free trials

Identity theft protection providers are competing with each other for your business. Because of this, each offers free trials to new customers. Use these trials to compare programs and see which features you need more than others. Premium features inflate the price, and you don't want to pay for something you won't use. To avoid paying a monthly fee, cancel your free trials before the end date,

Look for discounts and whether you already have access to identity theft protection

Yes, discounts are available for all the most popular identity theft protection plans. These discounts might involve using a promotion code found online or buying a membership on a yearly (not monthly) basis. Discounts are also sometimes offered when activating autopay. 

Interestingly, you might already have access to a free identity theft protection plan and don't know it. For example, after a retail data breach, companies often offer free protection plans to would-be victims on a limited basis. The freebie is typically mentioned in the letter or email you receive following a data breach. 

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(Image credit: Future)

Additionally, some banks and credit unions now offer free identity theft protection as part of their membership. Credit card companies also do this with increasing frequency. Employee benefits plans and homeowners'/renters' insurance policies also sometimes offer ID protection, as do service organizations such as AAA and AARP.

One point to keep in mind: Some companies that offer identity theft protection plans only provide basic packages. If options are missing, you might need to upgrade to a premium plan to gain features. However, you'll receive the upgrade for a discount in most cases.

Family or individual plans? 

Unfortunately, you aren't the only one in your family that needs identity theft protection. Kids, for example, are often targeted by scammers because they don't yet have a credit history. In some cases, this makes it easier for criminals to open new accounts in their names. So you might find buying a family identity theft protection plan vs. an individual plan a better choice in your situation. And the price difference might be minimal. 

Do you need identity theft insurance?

There's much you can do to protect yourself from identity theft and clear recovery steps to follow when something does happen. Besides the yearly or monthly cost of identity theft protection itself, identity theft won't cost you out-of-pocket financial loss once it's proven something criminal has occurred.  The most significant expense isn't monetary but rather the time and hassle involved in clearing your name from discrepancies. Because of this, it's not necessary to pay extra to add identity theft insurance to your plan. 

Besides, most banks and credit card companies already provide fraud protection guarantees for free. It's one of the reasons credit card interest rates are so high, after all!

Be sure to review the eight surprising facts about identity theft.

Bryan M. Wolfe is a staff writer at TechRadar, iMore, and wherever Future can use him. Though his passion is Apple-based products, he doesn't have a problem using Windows and Android. Bryan's a single father of a 15-year-old daughter and a puppy, Isabelle. Thanks for reading!