Identity theft and cybersecurity concerns are always more acute during tax-filing season in the U.S. But in 2021, cyber experts believe individuals, organizations and companies must be extra vigilant in their battle against hackers and other bad actors online. Why? The answer lies in the high volume of unemployment claims filed in 2020 and the speed with which states tried to respond to the intense need for unemployment benefits in the face of the pandemic's notable job loss. Unemployment in the U.S. reached as high as 14.8% in April 2020 before declining to 6.7% in December 2020, according to the Congressional Research Service. In some severely impacted industries, notably leisure and hospitality, the jobless rate reached as high at 39.3%. That means millions of Americans were applying for unemployment benefits in 2020, which created a fresh opportunity for fraud. Some of those crimes will only begin to surface during the 2021 tax season. Tim Zeilman, vice president of global cyber products at Hartford Steam Boiler (HSB), recently talked with PropertyCasualty360.com about this particular threat. "Every year when tax season comes around, there's an increased focus on identity theft because of people stealing identities and using Social Security numbers and other identifying information to file fraudulent tax returns," Zeilman said. "There's even more of it going on this year. Bad guys are using stolen credentials to file phony unemployment benefit claims." These crimes might not have been readily apparent because the first victim was state governments. But victimized individuals will begin to run into problems now as they attempt to file taxes and find that someone else has used their Social Security number, or the government believes they had unemployment-benefit income that was never received. The slideshow above illustrates steps individuals can take to safeguard themselves against tax season identity theft, courtesy of the cybersecurity experts at HSB, which is part of Munich Re. One of the major protective steps individuals can take during tax time is being aware of the tell-tale signs of identity theft, which include unfamiliar or unauthorized credit charges, missing bills or bills for goods, services or utilities never received, and suspicious activity on one's bank or credit card statements. Zeilman explains that breach coverage and identity theft protection and remediation are separate functions under the heading of cybersecurity. These days, companies and individuals are largely aware of the variety and severity of cyber risks in the world, but they may be less familiar with the insurance tools available to mitigate these threats. "I put coverage for identity theft and coverage related to other personal cyber exposures in two different categories," Zeilman said. Since identity theft is more of an individual risk, it follows that individuals need to make sure that their homeowners or renters insurance policies include an identity theft rider. Some employers also offer identity theft protection as part of their benefits packages. Some credit card companies and financial institutions also extend this protection to their customers. Particularly, as remote work, digital services and online transactions continue to grow in popularity, Zeilman encourages everyone to check their current insurance policies or reach out to the financial institutions they work with to clarify their level of identity theft protection and the degree to which they'd be covered should a thief get ahold of their personal information. Money magazine suggests that individuals who suspect they have been victimized by identity theft take the following steps: |

1. File a claim with your identity theft insurance, if applicable.
2. Notify companies of your stolen identity.
3. File a report with the Federal Trade Commission.
4. Contact your local police department.
5. Place a fraud alert on your credit reports.
6. Freeze your credit.
7. Sign up for a credit monitoring service if offered.
8. Tighten security on your accounts.
9. Review your credit reports for mystery accounts.
10. Scan credit card and bank statements for unauthorized charges.

Many insureds fail to realize that their cybersecurity insurance policy may not cover identity theft. Insurance professionals can go a long way toward underscoring their value with clients by educating them about this risk and facilitating a coverage analysis and policy review distinct from the one-size-fits-all insurance offered by today's trendy direct-to-consumer insurance providers. Keep reading... |

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