Many consumers consider Consumer Reports a trustworthy source of independent product and service information, in order to make smart purchases. As a child, I remember watching my parents read Consumer Reports' product testing results before buying a car and expensive household appliances. I currently subscribe to Consumer Reports' On Health publication.
Last month, Consumer Reports reviewed LifeLock, a credit monitoring service:
"LifeLock spent $5 million on TV and radio ads nationally in the first half of this year and claims to have 300,000 subscribers. It has been endorsed by actor Fred Thompson (before he officially became a presidential candidate) and radio personalities Rush Limbaugh, Sean Hannity, and Paul Harvey. But as Harvey might say, now here’s the rest of the story."
What LifeLock does to protect your sensitive personal data and credit reports:
"For $10 a month or $110 a year, LifeLock instructs the top three credit-reporting agencies — Equifax, Experian, and TransUnion — to place fraud alerts on your credit reports and renews them every 90 days. The service also tells the three bureaus that you opt out of receiving preapproved credit offers and asks the Direct Marketing Association (DMA) to remove your name from mailing lists. Of course, you can do those things yourself free. And fraud alerts are no guarantee against ID theft. Some lenders don’t see them and allow crooks to open accounts in other people’s names anyway."
If you are like me, then you've already done most of this on your own -- for free. I placed Fraud Alerts on my credit reports, and later renewed them. I have already opted out of pre-approved credit offers and telemarketing lists -- again, for free. Is there anything LifeLock provides that we consumers can't do ourselves? Perhaps it's their credit restoration services:
"... the company guarantees against all losses and expenses a client incurs up to $1 million. LifeLock’s guarantee will restore stolen funds to your bank accounts, get fraudulent credit accounts closed, pay lost wages, hire credit-repair firms, and do "whatever it takes to get your life back..."
While that sounds really appealing, Consumer Reports also wrote this:
"But the customer agreement doesn't actually bind LifeLock to much of what Davis promised us. It specifically says that the company will not reimburse "consequential damages, such as lost wages." [LifeLock CEO] Davis says customers should ignore the fine print: "The lost-wage clause is there because insurance commissioners wanted to be sure we’re not an insurance company. We’re not." The contract, meanwhile, is vague about reimbursing stolen money: "We will pay professionals to assist in restoring any such loss." The guarantee hinges on "the failure or defect in our service," which the contract defines as initiating requests with credit bureaus and the DMA. But Davis says the contract really means something else: "If the fraud alerts did not do what they were intended to do, then the service failed. I don’t just mean that my system didn’t send them correctly," he says.
If you are considering LifeLock to protect your identity, I strongly encourage you to read the entire Consumer Reports review of LifeLock first. Then decide if LifeLock is for you.