March 31, 2006 by Canadian Underwriter
St. Paul Travelers (NYSE:STA) announced it’s the first insurance company to offer identity theft coverage for commercial businesses in Canada.
The Identity Fraud Expense Coverage Master Policy is available to financial institutions, commercial businesses and business associations and their customers, employees or members. It’s the same coverage currently available to businesses in the United States.
The Master Policy reimburses identity theft victims for up to $25,000 per covered person to restore their financial health and credit history. The policy covers the following:
Lost wages that result from time taken off work to deal with the fraud, including wrongful incarceration;
Notary and certified mail charges for completing and delivering fraud affidavits;
Fees to reapply for loans that were denied due to erroneous credit information caused by the identity theft;
Long distance telephone charges for calling merchants, law enforcement agencies or credit grantors to discuss the identity theft; and
Legal fees incurred, with St. Paul Travelers’ prior consent.
“We recognize that identity theft is a growing crime in North America and that there is an urgent need to address this problem,” Phil Baker, vice president of St. Paul Travelers financial and professional services, said in a press release. “Unfortunately, people often become victims by conducting routine business such as using credit cards or submitting personal information to employers or government agencies, not realizing that they may be exposing this confidential data to someone who will steal their identity without their knowledge or permission.”
Identity theft cases are on the increase in Canada, according to PhoneBusters, an anti-fraud national call centre located in Ontario. The company reported on its Web site that it received 11,231 identity theft complaints from Canadians in 2005. Total reported losses in 2005 added up to more than $8.5 million.
In the first two months of 2006, 1,137 complaints were filed with PhoneBusters, amounting to total reported losses of more than $1.8 million.
According to the Identity Theft Resource Center in San Diego, it takes an individual almost 600 hours and $1,400 in out-of-pocket expenses to recover from identity theft.