Tag: Credit Sesame

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Identity Theft Protection, News

Is Credit Sesame’s $50,000 Identity Theft Insurance Worth the Hype?

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Is Credit Sesame's $50,000 Identity Theft Insurance Worth the Hype?

If you register an account with Credit Sesame, the credit monitoring and financial recommendations company now provides an unconventional perk: a free identity theft insurance policy with $50,000 worth of coverage.

Identity theft insurance, like the insurance offered by Credit Sesame, helps victims of fraud to recoup money they may spend to resolve the issue. In minor cases of fraud, victims may have to pay for notary expenses, to freeze and thaw their credit, or to replace a visa, passport, or driver’s license. In serious cases, victims may lose wages when they take time off from work to deal with identity theft. Some victims may even have to pay for legal representation.

Without insurance, it is possible — but not always the case — that victims might have to pay out of pocket to resolve cases of identity theft.

Credit Sesame’s identity theft insurance policy might be “free,” but is it worth getting excited over? We took a closer look at the policy and compared it to similar offerings from competitors.

Here’s what we found.

Yes. It really is free.

Free sounds good, but it’s usually filled with gotchas. Is Credit Sesame’s identity theft insurance really free? Yes. It’s real insurance, and you really don’t have to pay. Despite the $0 price tag, the insurance policy isn’t half bad.

What Credit Sesame’s policy covers:

With a few exceptions, Credit Sesame’s policy covers:

  • Application re-filing fees
  • Courier costs
  • Notary costs
  • Court costs
  • Legal representation (up to $75 per hour)
  • Lost base wages if you need to take time off from work (self-employed people can’t receive any compensation)
  • Dependent care coverage
  • Travel costs
  • Postage or other communication costs

What Credit Sesame will not cover:

Credit Sesame’s insurance never replaces stolen money that has been taken from a bank, savings, or other financial account.

Like most other identity theft insurers, Credit Sesame also won’t reimburse identity theft costs if the theft occurred under suspect conditions.

  • Credit Sesame will not cover fraud perpetrated by the victim or a family member of the victim.
  • They will not reimburse customers who voluntarily gave up their account numbers.
  • They only cover cases of identity fraud. That means if the fraudulent activity occurred because the victim or a bank employee made an error, the victim can’t get reimbursed for those costs.

Is that enough insurance?

Most of Credit Sesame’s competitors (and Credit Sesame’s premium product) offer up to $1 million in identity theft recovery services, so a $50,000 policy may seem skimpy. But bigger policies don’t necessarily offer better benefits.

Many million-dollar ID theft policies aren’t a great deal. You’re unlikely to spend thousands resolving identity theft. According to the Federal Trade Commission, most people spend just $40 for resolving identity theft. Five percent of identity theft victims spent more than $2,000 resolving identity theft.

The highest potential cost associated with identity theft is the cost of legal representation. Credit Sesame’s policy offers to cover $75 per hour for legal needs. But some attorneys can charge much more than that. According to Lawyers.com, a database that matches consumers with lawyers, most experienced lawyers charge $100-$200 per hour. So if a victim has to hire a lawyer, Credit Sesame’s policy may cover only some of their legal fees.

You might be worried that Credit Sesame doesn’t reimburse stolen funds, but in most cases banks will reimburse you anyway. The Fair Credit Billing Act (FCBA) and the Electronic Fund Transfer Act (EFTA) protect consumers from having their accounts drained.

The FCBA assures that you have to pay a maximum of $50 in fraudulent charges on a credit account. Your credit card company will reimburse your for the rest. In fact, most credit card companies have $0 fraud liability. That means you don’t have to pay for any fraudulent charges at all.

The EFTA covers you if someone steals money from your checking account. As long as you report fraud on your checking account within 48 hours, your bank will reimburse you for all but $50 of the charges. If you wait 2-60 days, the bank could leave you with $500 in losses.

Unless you have significant assets in a brokerage account, you’re legally protected. In the rare case that the law doesn’t protect you, your insurance probably won’t either. Most ID theft insurance companies limit their reimbursement of stolen funds to somewhere between $10,000 and $25,000.

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Is it worth signing up for a Credit Sesame account?

Credit Sesame’s insurance is a useful tool to limit financial exposure, and it can be a part of your plan to protect yourself against identity theft. But the reality is you probably don’t need identity theft insurance. You may prefer to keep your email address to yourself rather than get blasted with emails from Credit Sesame.

Most people can handle the $40 out-of-pocket fees associated with identity theft. Even $2,000 of costs can be manageable if you have an emergency fund.

When it comes to identity theft, the biggest cost you’ll face is the cost of your time. On average, victims spend four hours unraveling identity theft issues, and 5% of victims spend more than 130 hours. Credit Sesame’s insurance product won’t help you with that.

If you want identity resolution services, you can get them as a free perk from several credit cards, including:

You can also compare identity theft monitoring and resolution services on the MagnifyMoney website to find a product that suits your needs.

How to sign up

In order to take advantage of Credit Sesame’s ID theft protection, you’ll need to sign up on the site using your email address. You’ll provide personal information, including your Social Security number and your address. You cannot get free insurance unless you complete your Credit Sesame member profile.

Is it safe to provide this information? Credit Sesame promises that they will not give or sell your information to third parties without your express permission. They use multifactor authentication, which makes it difficult for hackers to take your information from their website.

What’s the catch?

The value of Credit Sesame’s insurance protection policy may not be worth the cost of handing over your email address. Customers are bound to receive marketing emails from the company, encouraging you to visit the site to check your credit score. Once on the site, you’ll receive recommendations to sign up for certain credit card or financial products that may or may not be best for your needs.

Eventually, Credit Sesame will nudge users to upgrade their Credit Sesame service.

Credit Sesame pushes their premium service offerings to existing customers. If you pay more, you can get up to $1 million of insurance and more monitoring. The additional insurance coverage still won’t reimburse you for stolen funds that your bank won’t replace.

The costs for these products include:

  • $14.95 for monthly reports from the three credit bureaus.
  • $19.95 for credit resolution help from an assistant.
  • $24.95 for lost wallet resolution assistance and dark web monitoring.

These prices are higher than competitors, and Credit Sesame’s product doesn’t offer full resolution coverage at any price.

Hannah Rounds
Hannah Rounds |

Hannah Rounds is a writer at MagnifyMoney. You can email Hannah at hannah@magnifymoney.com

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Building Credit, Reviews

Credit Sesame Review: Free Credit Score But A Full Credit Report Will Cost You

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Credit score large

Looking for an inexpensive way to check your credit score? Credit Sesame offers consumers a free score, plus score analysis, credit monitoring and financial product recommendations. Credit Sesame also has premium plans that come with extra perks like full credit reports, identity protection and live support to help you resolve credit report discrepancies.

Free ID Theft Protection It’s very easy to sign up for the free Credit Sesame service and no credit card is required. First, you input information including your address and the last four digits of your social security number. Then, Credit Sesame will ask you questions about your accounts to verify your identity.

With the free plan, you get score updates and alerts if there are changes to your credit report. The Credit Sesame dashboard includes an explanation of each credit factor impacting your score. There’s a trend section where you can see how your score changes over time. The free plan also comes with $50,000 worth of identity theft insurance.

If you want a full credit report from Credit Sesame you have to pay for it and there are two ways you can obtain one. You can either pay $9.95 for a single report or you can sign up for one of the premium plans, which includes monthly credit reports. According to an expert at Credit Sesame, the site generates revenue from sales of the paid products, so the basic credit reporting service is free with no catches.

[Best Free Credit Score Sites for Each Bureau]

Credit Sesame Paid Plans

Credit Sesame has three premium packages including the Advanced Credit, Pro Credit and Platinum Protection plans. Here’s what you’ll get with each one:

Advanced Credit – $7.95 per month (billed annually)

  • Daily credit score updates from TransUnion
  • Daily credit monitoring of your TransUnion report
  • Assistance with identity restoration if you’re a victim of fraud
  • $50,000 in identify theft insurance
  • A monthly full credit report from TransUnion
  • 24/7 live experts to resolve credit report discrepancies

(The Advanced Credit plan has pretty much the same features as the free plan, except you get a monthly credit report and 24/7 live support to resolve errors).

Pro Credit – $12.95 per month (billed annually)

  • Monthly credit score updates from all 3 credit bureaus
  • Daily credit monitoring of all 3 credit bureaus
  • Assistance with identity restoration if you’re a victim of fraud
  • $50,000 in identity theft insurance
  • Monthly full credit reports from 3 credit bureaus
  • 24/7 live experts to resolve credit report discrepancies

Platinum Protection – $15.95 per month (billed annually)

  • Monthly credit score updates from 3 credit bureaus
  • Daily credit monitoring of 3 credit bureaus
  • Dedicated specialist who will act on your behalf to handle identity restoration in case of fraud
  • $1 million in identity theft insurance
  • Monthly full credit reports from all 3 credit bureaus
  • 24/7 live experts to resolve credit report discrepancies
  • 24/7 live experts to provide stolen/lost wallet protection
  • Black market website monitoring
  • Public records monitoring
  • Social Security number monitoring

Be Critical of Product Recommendations

Credit Sesame uses your personal data to provide product recommendations for credit cards, personal loans and mortgages. For the most part, the site offers products that may help you repay debt faster, save money on interest or improve your credit score.

Don’t assume every offer is right for you. Do your own research to confirm whether or not a recommendation will, in fact, benefit your financial situation. Product recommendations from Credit Sesame partners will also pop up in your inbox, which can become a nuisance. However, there is an option at the bottom of each email to unsubscribe from future emails.

How Credit Sesame Determines Your Score

The free score you get through Credit Sesame is a VantageScore. Keep in mind, the VantageScore isn’t the FICO score which is often used to determine your creditworthiness. Ultimately, the free score you pull from Credit Sesame may differ from the one pulled by a lender or credit card company when you turn in an application.

The VantageScore ranges from 300 to 850 and is determined using the following factors from your credit report (from most impactful to least impactful):

  • Credit Card Utilization
  • Payment History
  • Derogatory Marks
  • Age of Credit History
  • Total Accounts
  • Credit Inquiries

It’s still beneficial to get your credit score from Credit Sesame to see approximately where you stand. And it’s an affordable way to monitor your credit for errors or identity theft. Currently, the three major free score sites, Credit Sesame, Credit Karma and Quizzle, all use the VantageScore rather than the FICO score.

Credit Sesame & Data Security

Credit Sesame does need to collect sensitive data in order to generate your credit score and provide you with credit reports. To protect your information, firewalls are used along with data encryption including 128-bit SSL encryption and 256-bit AES encryption. The Credit Sesame protection processes have been approved and validated by Verisign, TRUSTe and McAfee. Plus, its servers are monitored by 24-hour surveillance.

What’s the Catch?

The main catch with Credit Sesame is the free membership doesn’t come with a full credit report. Both Credit Karma and Quizzle offer you a full report at no cost. In addition, the product recommendations throughout the Credit Sesame free profile can be somewhat distracting at times. But overall, Credit Sesame is a decent tool to check your credit score and gain insight on the positive and negative components impacting your credit health.

 

Taylor Gordon
Taylor Gordon |

Taylor Gordon is a writer at MagnifyMoney. You can email Taylor at taylor@magnifymoney.com

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