Identity theft protection services promise to be your guardians against financial fraud, but are they worth the price? These companies offer a range of services, from credit monitoring to fraud alerts, for a monthly or annual fee. However, they often fall short of preventing identity theft, and consumers may find better protection through free alternatives.
Understanding Identity Theft Protection
Identity theft protection services primarily begin with credit monitoring, which involves tracking your credit reports and alerting you to suspicious activity. These alerts, however, are reactive — they notify you after a potential problem has occurred. While helpful, they don’t prevent someone from stealing your financial data.
That’s why financial experts often promote proactive measures like a credit freeze, which can prevent the opening of fraudulent accounts.
Comparing Identity Theft Protection Services
Several companies offer identity theft protection plans, each with its own set of features, pros, cons, and costs.
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Aura:
- Pros: Includes features like a VPN, antivirus protection for multiple devices, and an Experian credit lock. Allows for the addition of multiple adults, children, and devices. Offers free trials and money-back guarantees.
- Cons: Does not monitor social media accounts. Annual plan cancellations after 60 days require payment for the full year.
- Cost: $12.99/month for individuals (monthly), $119.88/year (annual), $19.99/month (couples), $47.99/ month (families).
- Best for: Budget-conscious individuals and larger families.
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LifeLock Ultimate Plus:
- Pros: Offers comprehensive services, including social media monitoring and three-bureau credit monitoring, plus features like a $1 million identity theft recovery plan and investment account alerts.
- Cons: High cost, especially for the top-tier plan. The price increases after the first year of an annual plan. The company had a data breach in 2023.
- Cost: $41.99/month for two adults (monthly), $34.99/month for two (annual).
- Best for: Individuals with higher budgets seeking comprehensive protection.
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IDShield:
- Pros: Transparent pricing, offers consultations with an identity theft expert, and scans social media posts.
- Cons: Dependence on the service may lead to complacency. Overabundance of alerts might cause users to overlook important information.
- Cost: $19.95/month (individuals), $34.95/month (family plan).
- Best for: Price-conscious consumers who want social media monitoring.
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IdentityForce UltraSecure+Credit:
- Pros: Competitive features, including dark web monitoring and credit activity monitoring for children. Offers advanced fraud alerts.
- Cons: Limited choice of VPN or device protection. Website may be confusing.
- Cost: $39.90/month (individual), $399.90/year (individual), $24.90/month (family), $249.90/year (family).
- Best for: Users prioritizing advanced fraud monitoring.
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ID Watchdog Premium:
- Pros: Simple credit monitoring, alerts and recovery. May provide assistance with pre-existing identity theft (for an additional fee). Allows for multiple family members on the same plan.
- Cons: Equifax acquired the company, during the year of a major data breach. The mobile app receives low ratings.
- Cost: $21.95/month (individual), $220/year (individual), $34.95/month (family), $350/year (family).
- Best for: Those needing assistance with pre-existing identity theft.
Remember, this is just a brief overview. Researching different providers is important to find the best fit for your needs.
What Do Identity Theft Protection Services Do?
These services generally offer:
- Monitoring: Monitor credit files, alert users of new accounts, data breaches, and credit inquiries.
- Alerts: Notify you of instances where your information has been used, like attempts to open bank accounts in your name.
- Recovery: Offers assistance with recovery after identity theft, including insurance policies of up to $1 million.
Many also provide extra services like alerts about identity theft news and local sex offender registries, and monitoring of the dark web.
Protecting Yourself Without Paying Costs
You can manage many of the services offered by identity theft protection companies yourself, often without cost:
- Monitor your Credit Reports: Review your credit reports regularly and get a free credit score through websites like NerdWallet.
- Report Identity Theft: Follow the free recovery paths outlined by the federal government on websites like IdentityTheft.gov.
- Freeze your Credit: Freeze your credit files at all three major credit bureaus (Equifax, Experian, and TransUnion) for free, a function that protection services don’t have more control over.
“The first thing consumers need to do if they’re worried about ID theft is just to freeze their credit reports,” says Chi Chi Wu, senior attorney at the National Consumer Law Center. “Freeze, freeze, freeze. Everything else is gravy on top of that.”
Is Identity Theft Protection Worth It?
Whether it’s worth the cost is a personal choice. Compare plans and their prices to find a good match for you. Make sure you’re choosing services that monitor all three credit bureaus. Be wary of credit monitoring products from the credit bureaus themselves.
Consider paying for an identity theft protection service if:
- You’ve already been a victim of identity theft.
- You’re unwilling to freeze your credit reports.
- You know you won’t actively monitor your own credit.
However, if you are willing to take the steps to protect your identity yourself, you can obtain adequate protection without paying any fees.
