Holiday Shopping and Identity Theft

The holidays are just around the corner, and it’s time to start thinking about what gifts to buy your loved ones. The holiday shopping season is a fun-filled time, but it does present risks, since there are so many transactions taking place and more opportunities for identity theft to occur.

Did you know that according to the Bureau of Justice Statistics an estimated 17.6 million persons, or about 7 percent of U.S. residents age 16 or older, are victims of at least one incident of identity theft every year?

The most common type of identity theft is the unauthorized misuse or attempted misuse of an existing account—experienced by 16.4 million persons.  Most identity theft victims discovered the incident when a financial institution contacted them about suspicious activity (45 percent) or when they noticed fraudulent charges on an account (18 percent).

Two-thirds of identity theft victims reported a direct financial loss. And of those that experienced losses approximately 14 percent lost $1,000 or more. With that information in mind, we have put together a list of 10 tips to avoid identity theft during this busy shopping season.

Be Wary of Contests
Many online contests promising large prizes could be scams such as sources of computer viruses that will try to hijack your information.

Change Your Passwords
Have you had the same password for the last five years? It’s time to change it up. Create a password that is long and complicated, and doesn’t reference any of your personal information like your birthday. Stay away from using coherent phrases by breaking up words with exclamation points and other symbols, and of course, don’t use the typical “password” or “1111.” It’s also crucial that you use a different password for each account. If you need help with this, try using a password vault instead of trying to memorize them all yourself.

Check Websites
Make sure that the websites you’re using are secure. To lessen your chances of becoming a victim of credit card theft, only enter your credit card information on sites with URLs beginning with “https.” The “s” in the address stands for “secure,” and lets you know that your connection to the site is less likely to be overseen by hackers. This is especially important whenever you are entering sensitive information, such as credit card or Social Security numbers.

Check Your Credit Score
As the end of the year approaches, take a look at your credit report to check for inaccuracies as well as monitor your credit score. Every person can receive one free report from each of the three credit bureaus.

Cover Up
Shield your credit card and PIN number from view when making transactions so that thieves can’t steal your numbers by looking over your shoulder.

Don’t Trust Public WiFi
It’s tempting to do your online shopping at Starbucks, but you shouldn’t trust public WiFi networks to protect your identity.

Email with Care
Don’t submit personal information via email, even if it’s for a reputable organization.

Only Use One Credit Card
Shopping online is a very efficient way to get every item on your list checked off, but consider ways you can practice internet safety. For instance, designate one credit card for online shopping purposes, instead of using multiple ones across different sites.

Take it with You
Identity theft doesn’t only happen over the internet. The police also advise against leaving items in the car as you go shopping. If someone breaks into your vehicle, they could steal something that reveals your identity and puts your information at risk.

Why Identity Theft Insurance is so Important

According to a report by Internet security firm Kaspersky Lab, in what could be one of the largest bank heists in history, more than 100 banks and ATMs have been rigged so that thieves could steal up to $1 billion in cash.

Hackers from Russia, Ukraine, China and Europe were involved in the organized crime ring that was just recently exposed. The hackers installed spying software on bank computers, studied bank employee workflows so they could learn how to mimic their actions and used their knowledge to transfer money into bank accounts set up in other countries.

While the report did not name specific bank institutions, it stated that financial institutions in at least 30 countries were affected, including the United States.

We all know that identity theft is the act of taking someone’s personal information and using it to impersonate a victim, steal from bank accounts, establish phony insurance policies, open unauthorized credit cards or obtain unauthorized bank loans.

What many people don’t realize, though, is that 7% of all U.S. citizens will be victims of identity theft over the next 12 month resulting in over $50 billion in costs. Identity theft is also a long, arduous process for victims as they try to repair their credit, erase erroneous collection accounts, and restore their lives.

Did you know that many homeowners insurance policies actually offer some form of identity theft as part of the policy? You can find out more about this coverage, its cost, and provisions within the rest of the of article below.

If you would like to see if your policy includes identity theft coverage or would like to receive quotes on this coverage, please feel free to give our office a call.

Identity Theft Insurance

What is it?

Some insurance companies now include coverage for identity theft as part of their homeowners insurance policy. Others sell it as either a stand-alone policy or as an endorsement to a homeowners or renters insurance policy.

What does it cover?

Identity theft insurance provides reimbursement to crime victims for the cost of restoring their identity and repairing credit reports. It generally covers expenses such as phone bills, lost wages, notary and certified mailing costs, and sometimes attorney fees (with the prior consent of the insurer). Some companies also offer restoration or resolution services that will guide you through the process of recovering your identity.

What does it cost?

Some insurance companies will include identity theft coverage for no additional cost. However, most will charge anywhere from $25 to $100 annually for the additional insurance coverage.

Tips for Avoid Identity Theft

  • Keep the amount of personal information in your purse or wallet to the bare minimum. Avoid carrying additional credit cards, your social security card or passport unless absolutely necessary.
  • Always take credit card or ATM receipts. Don’t throw them into public trash containers, leave them on the counter or put them in your shopping bag where they can easily fall out or get stolen.
  • Do not give out personal information. Whether on the phone, through the mail or over the Internet, don’t give out any personal information unless you have initiated the contact or are sure you know who you are dealing with and that they have a secure line.
  • Proceed with caution when shopping online. Use only authenticated websites to conduct business online. Before submitting personal or financial information through a website, confirm the site is secure.
  • Make sure you have firewall, anti-spyware and anti-virus programs installed on your computer. These programs should always be up to date.
  • Monitor your accounts. Don’t rely on your credit card company or bank to alert you of suspicious activity.
  • Order a copy of your credit report from each of the three major credit bureaus. Make sure it’s accurate and includes only those activities you’ve authorized.
  • Shred any documents containing personal information such as credit card numbers, bank statements, charge receipts or credit card applications, before disposing of them.