Identity Theft as Marketing Opportunity

Since identity thieves are making many people worried about losing control of their identities, of course somebody has found a way to cash in on all that free publicity:

By now you've heard the stories about Americans whose identities have been stolen. They're not pretty…people working for hundreds of hours over many years to get their lives back in order, kids not getting student loans because someone has already ruined their credit, people losing homes because thieves placed mortgages they never knew existed, even innocent individuals ending up in jail.

LifeLock can keep this from happening to you and we guarantee our service up to $1,000,000.

— LifeLock

I seem to recall reading that the typical identity theft is only worth $1,000, but nevermind that.

Look who recommends it:

You've heard Rush Limbaugh, Paul Harvey, Dr. Laura, Sean Hannity, Howard Stern, Dr. Joy and others endorse us.

Well! None of those people would ever sell pure fear, would they?

I have to give them credit for honesty, though: LifeLock admits right out that the main four preventive things they do you could do for yourself. Beyond that, the main substance they seem to offer is essentially an insurance package:

If your Identity is stolen while you are our client, we’re going to do whatever it takes to recover your good name. If you need lawyers, we’re going to hire the best we can find. If you need investigators, accountants, case managers, whatever, they’re yours. If you lose money as a result of the theft, we’re going to give it back to you.

For $110/year or $10/month, is such an insurance policy overpriced, underpriced, or what?

-jsq

Comments

[Iang (manual trackback)]

See my comment on my blog, there is an interesting question here as to whether Insurance is the right direction to go with identity theft. I don't think I know the answer ... but I think the question is unfortunate.

[Iang (manual trackback to Identity Cost posts)]

I have frequently claimed that the cost of a full set of ID Documents is around $1000, as a sort of rule of thumb we can all work with in the security business. Not based on scientific analysis more compelling than collecting reports of the costs of sold Id sets from police press releases ....

(It might actually be cheaper in the US, not sure.)

[Dan Weinreb]

I don't know about the $1,000. If
I were a victim, it would take
countless hours of my time to deal
with the problems, and I would feel
a lot of hurt and anxiety and stress. For me, that's a lot more
than $1,000.

[jsqrisk]

Good point, Dan. This is one reason why it's hard to say whether what LifeLock is selling is priced well or not. I suppose if many people buy it, it's priced right for its market.

[Andy - Compare Lifelock and Loudsiren Debix identity theft protections programs here!]

I think its priced right for a 1,000,000 dollar policy and the other benifits are time savers. Regardless of the route one chooses it is important to protect yourself.