Fraud protection and its fee

[Benzadmiral]

In line with the stories of credit card disputes --

I just had occasion to ask a question about a charge, the description of which I didn't recognize, and so spoke with one of the "customer service" guys. (It turned out to be my regular toll-bridge charge.)

In the course of the conversation, he tried to sell me on fraud protection. For a mere $7.99/month, they would monitor my Chase account, all my checking or other accounts, and my credit bureau listings, and alert me "instantly" if there should be something strange. From what Apu had to say, I would be insured up to $200K from identity theft.

I'm not sure nearly $100/year, and having somebody with that kind of access of my accounts, is a good deal. What say you?

 

[Drew99GT]

If it's a Lifelock type deal, it's all bogus. You're paying for them to renew a fraud alert for all the credit bureaus. The credit bureaus hate them.

http://lifelock-scam.com/lifelock-scam/

 

[CivicFan]

Whenever they sell 'fraud protection' policies, I am sure their eyes make a ka-ching sound when they blink. It's a tool to take advantage of people who hear the news about identity theft and such on TV and freak out.

 

[Dave Hess]

All you need to do is call your CC company and ask the to put a 'FRAUD ALERT' on your credit file.

 

[Benzadmiral]

Originally Posted By: LT4 Vette
All you need to do is call your CC company and ask the to put a 'FRAUD ALERT' on your credit file.

That's just it -- it was my credit card company! They're having their customer service people push all kinds of extras, since so many people have defaulted on their CC balances, and people like me pay their balance every month and cheat the company out of their usury -- er, interest.

 

[dwendt44]

Fraud alerts are only temporary unless you file a police report.
And they don't stop someone from stealing you identity.

 

[Drew99GT]

Originally Posted By: dwendt44

And they don't stop someone from stealing you identity.


Todd Davis will even tell you that!

http://lifelock-scam.com/todd-davis/

 

[ksJoe]

IIRC, your fraud liability is limited by law on CC to $50. Debit cards don't have as good of (legal) protection.

But on debit and credit cards, the company typically chooses to hold you liable for nothing.

Basically, you're buying insurance against that nonexistent $50 liability, plus they may handle some of the hassles. *IF* you had multiple cards compromised, and *IF* they handled dealing with all CC companies, it *MIGHT* be a little easier to deal with just the ins. provider. Maybe.

But the way I see it, they're selling peace of mind, another party to deal with, and insurance that is almost entirely unnecessary. Which all boils down to an easy to sell highly profitable financial product. Exactly the kind of thing you'd expect them to push they're hard up for cash.

Whenever they don't take no for an answer, I say something like "anything getting pushed this hard must be a lot more profitable for you than me".

A week ago we had fraudulent charges on our CC. My wife couldn't deal with it because I'm the primary. So I called, it took maybe 5 minutes to explain the situation, and thats about it. They sent new cards, and it will take 90 days for a final resolution, but they've already credited our account. If we had the insurance, I would have gotten to spend 5 minutes on the phone with someone else. That's the only difference I see. If the service was free, I might opt in. At $0.01 / month or above, no thanks.

 

[Benzadmiral]

That's kind of what I thought. If this was such a great deal, how come they never offered it before?

I don't use my card that much, I make sure to deal online with only established companies, and when I do dispose of old bills or any other identity items, I shred them good. And Drew, that link about the Lifelock scam is very useful.