The Unexpected Costs of Identity Theft

When you fall prey to identity theft, some of the tolls it takes on lost money and hits to your credit score are obvious.

But there are hidden consequences as well. Even though most credit card issuers offer a zero-fraud-loss guarantee, what identity theft victims go through cannot always be measured or quantified, and the battle may not end once you get your money or good name back.

From the Pew Research Center: "Roughly three-in-ten Americans (28%) say they have suffered at least one of three kinds of major identity theft problems in the previous 12 months at the time of the survey: 21% have had someone put fraudulent charges on their credit or debit card; 8% have had someone take over their social media or email accounts without their permission; and 6% have had someone try to open a credit line or get a loan using their name."

One consequence that is not always apparent is the lasting effect identity theft has on a victim's credit. Even when the theft is identified — and caught relatively early — victims can still be turned down for purchasing cars, obtaining credit, and being approved for home loans years, or even decades, later.

Different types of identity theft are becoming more prevalent. In cases of child identity theft, where a young person’s identity (usually a Social Security number) is stolen, the theft may go undetected for years because credit checks are not typically done for minors. Medical identity theft is on the rise as well. This happens when your personal health insurance information gets into the wrong hands and used to steal expensive medical services — even surgeries — and prescription drugs or to procure medical devices or equipment such as wheelchairs. It may take several months before you discover this activity has taken place — usually when you get an unexplained bill or EOB (explanation of benefits) in the mail or you find your medical records have been compromised.

Since security experts often advise that justice for identity theft moves slowly, it’s more important than ever to prevent identity theft so you can avoid the added stress, time and financial losses as you work to resolve the situation. One way to stay vigilant? Whether over the phone, online or in person, be very careful about providing your personally identifiable information, such as Social Security number, birth date, etc. It’s also a good idea to order your credit report every 90 days to check for unauthorized activity. You can order a free credit report every year from AnnualCreditReport.com. (Note: this is the only authorized source for the free annual credit report that’s yours by law).

The typical victim may have to wait months, if not years, to resolve his or her case. They often don't know where to turn for advice – and many of those who have suffered identity theft also have legal issues to handle as a consequence.

One option for employees to help manage their identity and the legal issues surrounding the theft is a legal insurance plan that includes identity theft services. With these plans, employees can:

This all-in-one benefit gives employees a place to turn for help and starts them on the path back to regaining their good name.