Are Identity Theft Protection Services Worth the Money? It's Complicated

I’ve had a love-hate relationship with identity protection services for more than 15 years, despite serving as an advisor to some of these companies and using more than a dozen of these services.

At almost every presentation I’ve given on identity theft and fraud, I get asked the same two-part question: Are these services any good, and can I trust the companies behind them?

The answer is complicated. The identity protection industry has a checkered past, and has survived some early scandals. I also believe identity theft protection companies can exaggerate what they do for subscribers.

But they do offer helpful credit monitoring and online security tools for anyone who doesn’t want to do the grunt work of keeping tabs on their identity or their children’s. ID theft protection can also come in handy if your identity is compromised and you need help restoring it.

Early identity theft industry scandals

Many of the major identity theft protection providers have been sued, sanctioned and fined for making misleading or exaggerated marketing and performance claims. The most exaggerated of all being that they prevent identity theft when they really don’t.

For example, the Federal Trade Commission brought charges against LifeLock in 2010, alleging the company falsely claimed it could prevent all forms of identity theft. LifeLock later agreed to pay a $100 million settlement in 2015 on contempt charges regarding the initial court ruling. The FTC also accused LifeLock of failing to adequately protect customer data and not providing immediate security alerts to subscribers if it believed them to be victims of ID theft. LifeLock was later acquired by Symantec, in 2016, and is currently owned by Gen Digital.

Identity theft protection providers have also been accused by the Consumer Financial Protection Bureau of colluding with bank partners in deceptively enrolling customers in “add-on credit card” services they never received, including credit monitoring and identity theft protection.

In 2015, the CFPB fined Affinion Group and Intersections, Inc., the former owners of Privacy Guard and Identity Guard, $10 million for charging people for services unbeknown to them. The CFPB also fined Bank of America $727 million in 2014 and Citibank $700 million in 2015 in similar cases.

Since these massive penalties were issued and increased scrutiny fell over the industry, I’ve noticed services doing a better job in more honestly describing their features and delivering what their customers sign up for.

The case for signing up for ID theft protection

The world of cybercrime, scams and fraud has changed significantly because of AI. And many of these ID protection products have changed along with it. They still offer identity protection, but with a greater focus on your online safety.

Some of the top identity theft protection services offer dozens of features that go beyond tracking identity fraud or restoring identities. They offer bank account protections, reimbursement for bank fraud, password managers, virtual private networks and antivirus protection to help you stay ahead of many online threats.

What I like most about identity theft protection services is that once you sign up, you’ll be constantly reminded and educated about how to protect yourself. Many of these services provide weekly reminders for you to check your bank and credit card statements and review your credit reports. As a cybersecurity expert, I know that arming yourself with information is the best way to protect yourself online.

Many identity theft protection services also offer three credit bureau monitoring, which alerts you if any credit accounts are opened in your name — like a mortgage or a new credit card. While credit freezes are available for free to the public, most people aren’t using them. So identity theft protection companies can help people pay better attention to their credit.

Is identity theft protection right for me?

Identity protection services might be worth the money if these three things fall into place for you:

You can afford it. Identity theft protection isn’t cheap, especially for family plans, which can cost anywhere between $30 to $80 per month. You can typically find individual plans for anywhere from $7 to $20 per month.
You understand its limitations. Identity theft protection can’t prevent ID theft. It can, however, alert you if something is awry.
You can use most of the included features. Identity theft protection companies offer great credit monitoring and online security tools you should take advantage of, in addition to frequent cybersecurity best practice reminders.

Simply signing up for identity theft protection and sitting back isn’t a useful defense against any kind of cybercrime, scam or fraud — especially with the emergence of AI.

Though most identity protection services offer deep or dark web scans, that’s almost impossible to do in any meaningful way. Most stolen data is hidden behind paywalls or in places security vendors don’t have access to.

Billions of records are already out on the dark web, with millions more being added monthly thanks to data breaches. No vendor has the capability to constantly scan all those sources and all that data. So it’s best to assume that your information is already compromised and it’s on you to take the necessary precautions.

If you sign up for an ID theft protection service, and use it the right way, you have a very good chance of significantly improving your protection against the surging AI driven cybercrime wave.

But do your research. Compare company prices and features. And look at their track records and reputations. Don’t be impressed or moved by slick marketing campaigns or celebrity endorsements. They aren’t a good substitute for a good product at the right price.

Consider signing up for identity theft protection if you’ve been the victim of a scam or identity theft. Aura is CNET’s pick for the best identity theft protection service.