Last fall, I received an email from the security department of my bank notifying me there’d been a questionable charge on my debit card. I first thought it was a phishing email so I called the security department of my bank to find out it wasn’t a false email. A charge for $4.58 had been made on my account at a New York sporting goods store. Not having traveled from Dallas to New York recently, I worked with the security department to identify my legitimate charges & payments and refute the ones that weren’t mine. We then shut down that debit card and they mailed me a new one.
I was very lucky for three reasons;
- My bank caught the false charge quickly & notified me the day it happened.
- The amount of the false charge was less than $5.00. I was still able to contest it and have it reversed but it could have been more and that could have thrown my budget way off.
- I responded to their email quickly and we were able to shut that card off immediately before any more false charges were made.
I have no idea how my data was obtained or from where it was obtained. My suspicion is that it may have been scanned at a gas station I used that was different from my usual one, but I have no proof of that.
I examined an optional coverage for identity fraud that’s available on my homeowner’s policy. Most insurance companies offer this coverage on their homeowners and renters policies. While some of the policies differ in the amount they cover, typically they offer the following:
- Up to $15,000 of coverage to pay for expenses incurred by an insured as a direct result of any one identity fraud first discovered or learned of during the policy period including;
- Notarizing fraud affidavits or similar documents
- Certified mail sent to law enforcement, financial institutions, or credit agencies
- Lost income resulting from time taken off work to meet with or talk to law enforcement or credit agencies up to a maximum of $200 a day or $5,000 aggregate
- Loan application fees for re-applying for a loan when the application is rejected solely because the lender received incorrect credit information
- Reasonable attorney’s fees incurred to defend lawsuits brought against the insured and to remove criminal or civil charges
- The deductible for a fraud claim is $250.
The cost for this option varies by insurance company but ranges from $10 to $50 a year to add to your home or renters policy. This protection doesn’t minimize the risk of identity theft occurring, but it is valuable in helping someone clean up the mess that it causes. We’ll talk about actions and non-insurance services that may help lower your risk and prevent identity fraud in future posts.
Do you have a question or experience you’d like to share with us? Post it in the comments section of our blog or on our Facebook page. We’ll all learn from each other.