Credit monitoring is one of the important components of an effective identity protection program and is a great way to review credit transactions and detect fraud. A credit report monitoring can be automated through a third party service provider in exchange for a service fee or consumers can request their free credit reports once a year and review for any suspicious new accounts or noted events such as past due accounts and collection notices.
Although there are other types of identity monitoring practices and services such as medical and credit card monitoring services, most people rightfully focus on credit monitoring to deal with the financial aspect of identity theft. Credit report monitoring is more effective for detecting identity theft and preventing further damage if it is performed diligently, more often and as part of a broader identity protection strategy. Credit report monitoring doesn’t prevent identity theft but it is rather a strategy to help detect identity fraud after it has occurred and minimizes fraud damage. As mentioned, credit report monitoring must be a component of an effective identity protection plan but credit monitoring alone is not sufficient to prevent identity theft or detect identity misuse in other areas such as medical identity theft or employment identity theft. For example, if someone used your medical insurance information to receive expensive health care with your name, you will not detect this fraud through credit report monitoring until the balance is submitted for collection. In this case, we can only hope that health care providers promptly send you a medical statement which will help you detect the fraud as soon as possible.
One of the problems with credit report monitoring aside from the fact that it is an insufficient measure for a total protection against identity theft is that consumers either don’t review their reports for suspicious activities consistently or don’t review the information properly. Credit report monitoring is a time consuming and challenging task. Most people are not disciplined and trained enough to order and properly review their credit reports annually to detect unauthorized transactions. But even if they managed to review their reports, what is the best review interval? Is an annual review sufficient or should they review their reports every week, monthly or quarterly? The minimum review interval is an annual review which most people ignore and just sign up for expensive automated services without understanding the implications or their roles in the monitoring process. Most people think they can sign up for a credit monitoring service and forget about identity theft, but this is a huge misconception.
If identity fraud detection is part of your overall identity protection plan and I think it should be, you should obtain and review your free credit reports at least annually.
Read this article and learn how the Identity Diet program can help you protect your identity including with free credit monitoring.