As the incidences of identity theft continue to skyrocket, it’s easy to see how people are impacted at the personal level. However, businesses also bear the brunt of these breaches in less obvious ways.
Hidden costs add up in the form of work absences due to stress, productivity loss, unpaid bills and reputational damage.
As employers start to become more aware of these pitfalls, insurance brokers can do themselves and their clients a valuable service by offering identity theft protection as a voluntary benefit in a comprehensive employee benefits package.
About one in 10 employees have suffered tangible effects, primarily in the form of lost time (nearly one day in a workweek) and money (nearly $500 on average), according to the 2017 CyberScout Identity Theft Protection survey.
Exposure is growing
While tax fraud and credit card fraud are the most common forms of reported identity theft, there are other avenues criminals use to gather sensitive information. Among them are:
- Lost/stolen devices
- ATM card fraud
- Social Security card or passport theft
- Check fraud
- Medical records theft
- Rogue apps
While the types of exposure are increasing, different employees are vulnerable in different ways. For example:
- Millennials are especially vulnerable to exposure via mobile devices, unprotected apps and social media. This group is more likely to be lax about online security.
- Senior employees more often use handwritten checks and opt for paper statements. They may remain in the dark longer about the occurrence of a breach.
- C-suite executives often have more pressing issues to deal with, so identity theft may not be top of mind. However, a breach at their level may be particularly onerous to the company’s bottom line and reputation.
Despite these very real consequences, employers overall are still failing to act to prevent the threat of identity theft. Forty-seven percent say they discuss ID theft only once a year or almost never. And a little over half are planning or currently offer identity theft protection in their benefits offerings. This leaves 39 percent, or four in 10, that don’t offer any protection, the survey said.
The risks are apparent and the problem is pervasive. Despite the lack of coverage offered, 91 percent of C-level executives and HR professionals surveyed said in the survey that they are concerned about data and cyber security.
Brokers must step in
Brokers are in a unique position to discuss with employer clients how to avoid and mitigate the effects of identity theft. They can help clients realize the importance of keeping company and employee data secure—potentially saving the company millions of dollars—simply by expanding their voluntary benefits to include identity theft protection.
Brokers also must make their employer clients aware that by offering identity theft protection, they boost their clients’ competitive edge. Employees, in turn, are more likely to sign on with an employer who offers a better benefits package.
By offering employer clients identity theft coverage, brokers become a valuable ally in protecting the company’s bottom line, providing peace of mind and quick resolution in the event of a breach. In the end, the broker will benefit from this partnership.
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