"Homeowners and Renters Should Ask About Identity Theft Insurance Riders"

RELEASE: October 2001
CONTACT: Paul Richard, RFC, ICFE Executive Director

San Diego, CA.  There is a growing concern among consumers, especially since September 11th, that their credit card and other personal identity information will be stolen, if they make an online purchase. In August, The National Consumers League, founded in 1899, a Washington, DC-based organization that manages the National Fraud Information Center and Internet Fraud Watch, released the results from a recent national telephone survey showing that 43% of consumers believe their card numbers will be stolen.

The survey of 1,003 persons also reported that 59% of respondents believe it's safer to pay for an online encouraging consumers to pay with their credit cards because they can dispute any charges if something goes wrong." The NCL's survey results are troubling because card issuers and the card associations have spent a lot of time and money promoting how safe it is to use credit cards for online purchases. The NCL is also encouraging consumers to use their credit cards to make online purchases during the upcoming holiday season despite the survey results.

The promotional effort, however, allegedly is being undermined by the news media. "The media's stories concerning hackers stealing card numbers scare consumers," the NCL says. "Some consumers believe if they just visit a Web site, their card numbers will be stolen." The survey has a margin of error of plus or minus 3%.

Now, concerned consumers may be able to purchase a theft identity rider on their present homeowners or renters policies an annual endorsement for as little as $25 per year, with a $15,000 coverage limit that includes reimbursement for lost wages, phone bills or other expenses like legal fees or new loan applications. Some insurance companies are also testing a separate identity theft policy in about a dozen states.

Identity theft has grown more common with the advance of technology and the trends such as the increasing use of Social Security numbers as identification on loan or college applications. According to the Web site "www.identitytheft.org" a crime prevention site says more that 900,000 Americans each year become new identity theft victims. U.S. Secret Service statistics, quoted on an AARP Web site indicates consumers and institutions lost more than $745 million dollars in 1997, the last full year figures are available. The credit reporting agency Trans Union reported that theft identity complaints had risen to more than 550,000 calls in 1998. Losses have been on the increase, despite two Federal laws passed in 1998 allows victims to seek restitution for 'identifiable losses' from the criminal, including expenses to clear one's name.

Federal and state laws say the victims aren't responsible for the fraudulent debt they face because of identity fraud. Victims working to clear their names, however, must spend days and weeks calling or writing letters to credit companies or financial institutions to reestablish clean records. The identity theft insurance coverage is intended to help insured victims recover form the crime by reimbursing them for much, if not all of their recovery costs.

For more information visit the ICFE's Web page at: http://www.icfe.info

The site also includes helpful sections on increasing savings, using credit wisely, plus "How to set up and implement a spending-plan" (with a one page work sheet) for personal and/or family finances.

Money Helps" is available on the Internet free. You can receive the same information by mail by sending $1 AND a self-addressed, stamped (60 cents) # 10 envelope (SASE) to:

ICFE Money Helps
PO Box 34070
San Diego, CA 92163-4070

The information packet includes:
1) "15 Tips to improve spending practices";
2) "How to set up and implement a spending-plan";
      (plus a budget worksheet) for personal and/or family finances;
3) "Dealing with creditors";
4) "Steps to take to reduce indebtedness";
5) "How to spend smarter for household and grocery items," and a
6) "Spender's Profile" which helps people identify dangerous spending habits.
 

For more information contact Paul Richard, RFC ICFE Executive Director at 619-239-1401.