The recently announced settlement agreement in the ginormous Equifax security breach affected 147 million people. The settlement website, set up by an independent claims administrator, has a very easy way to check whether you are included and entitled to a remedy. This website also has a great FAQ section and the forms for filing a claim. The media is already warning about all sorts of related scams, so be careful where you look for details, and don’t respond to any phone call, email or text claiming to help- the claims administrator is sending out information by regular mail, and you can obtain all the information you need on the website linked above or the FTC website.
The Options For the Equifax Data Breach
The FTC website is a trustworthy source for the truth. Basically, there are three options. If you can document that you were the victim of identity theft from this breach, you may be able to recover some of your expenses, but the funds are limited. For the rest of us, there are two options. One, a cash rebate, but that depends on how many people ask for the cash, and they are already warning that based on millions of claims received in the first week after the settlement was announced that the cash option will be so small that you will be disappointed. Note: Only 31 million of the 575 million plan was set aside for this part of the settlement. The FTC claims that the second option is much better which offers at least four years of free monitoring at all three credit bureaus (Equifax, Experian, and TransUnion), $1,000,000 of identity theft insurance, and a few other benefits like 6 free copies of your credit report each year. They claim that the market value of the basic remedy is hundreds of dollars per year. So should you take the deal?
Here are some considerations in taking the Equifax Deal:
- Trust yourself: The law already allows you to get a free credit report from each of the 3 credit bureaus each year, so if you stagger your requests that is just like getting 3 free credit reports each year. Be careful to use the only authorized website for this: annualcreditreport.com
- The law already allows you to place a freeze on your credit file, which effectively stops future scammers from obtaining credit in your name. But Consumer Reports warns that a freeze is not enough- read here for their suggestions.
- Your bank or credit union already has very effective “red flag” policies in place to help detect and deter fraudulent activity on your accounts- check with them for details. These detection tools are getting better every year and are becoming a reliable way to stop fraud.
- Check with your insurance agent about ID theft insurance- it will be a lot cheaper to add it to your homeowner’s policy than the independent insurance plans offered by credit related businesses. Don’t trust promises of $1,000,000 worth of coverage without reading the fine print. See how much it actually covers for both out of pocket expenses, including legal fees and future harm to your credit profile which could result in higher interest rates or lost opportunities for credit related purchases. Note: neither the FTC website nor the claims administrator website provides a copy of the proffered insurance policy.
- You already have a lawyer! If you are a member of the class, don’t hesitate to call one of the lawyers being paid through the settlement funds to represent you. This would be a good way to obtain a copy of the insurance policy. Their names are on the settlement website, under the FAQ section.
- Take your time deciding- you have until next January to file a claim.
