Every year, about 27,000 Canadians report being victims of identity theft, according to the Canadian Anti-Fraud Centre. The centre reported that ID theft cost Canadians $21.2 million in 2018, nearly double 2017 losses of $11.7 million. These figures may also be under-reported, the Centre believes.
A serious ID theft incident can force you to take time off work. You may experience after-effects for months or even years. Your credit is important; not only will it affect your ability to get good credit card interest rates, it can even affect your car insurance premiums in some provinces.
A number of home insurance policies offer add-on identity theft protection in the form of riders. Other home insurers provide identity theft monitoring and guidance as part of their policy package. Home insurance policies for ID theft don't duplicate the ID theft protection offered by your financial institution or credit card company. This type of insurance provides coverage ranging between $10,000 and $40,000. The coverage may reimburse you for expenses you incur after your identity is stolen, including the cost of taking time off work.
How can you protect yourself from ID theft?
Because ID theft isn't as rampant in Canada as it is in the U.S. or many other regions, Canadians may be more trusting and vulnerable to scams. You should exercise good financial and ID habits and be aware of trends in ID theft. Identity thieves are becoming more sophisticated. The CBC covered a scam that affected 3,000 Canadians who responded to a professional-sounding telemarketer offering a low-interest credit card deal. The deal was non-existent. The telemarketers just wanted personal information they could sell on the "dark web."
Here are a few tips to avoid ID theft:
- Be careful about providing personal identification that could be used to set up credit cards in your name. Shred all paper bills before disposing of them. Destroy any expired credit or debit cards. When applying for a mortgage or credit card, ensure you're dealing with a reputable broker or financial institution.
- Make sure your home wireless Internet connection and home network is secure. If you're not tech-savvy, ask your service provider for help. An "open" wireless connection is an invitation for anyone to not just piggyback on your Internet, but also gain access to your computer and personal information.
- When paying by credit or debit card, consider using contactless payment. Contactless payment encrypts your financial data for a one-time transaction. Even if thieves intercept and unencrypt the information, they won't be able to re-use it.
- Don't respond to solicitations for credit cards, personal loans, or sudden, unexpected prizes from contests you don't recall entering. Also, be wary of job offers that seem "too good to be true." Thieves are now obtaining personal information through employment offers for non-existent jobs.
If your identity is stolen once, it may be stolen several times over. One way to protect yourself is to look for home insurance policies that has extra coverage for ID theft.