What is a credit protection program?
Definition
A credit protection program is a service or set of tools that helps guard your credit file against identity theft, such as a credit freeze, a fraud alert or paid credit monitoring.
- Category
- Identity
- Also called
- credit protection service, credit protection plan
- Last updated
"Credit protection program" is not a legal term with one official meaning. Companies use it for very different things, so the first job is to look at what a program actually does.
The FTC describes three tools that sit under the label:
- Credit freeze. A freeze blocks new credit accounts from being opened in your name. It is free to place and lift, anyone can use it even if their identity has not been stolen, and you place it with each of the three credit bureaus. It stays until you lift it.
- Fraud alert. An alert does not block access to your credit report. It makes businesses verify your identity before they open new credit. An initial alert lasts one year and can be renewed. Placing it with one bureau is enough, because that bureau must tell the other two.
- Credit monitoring. A service that watches your credit report and flags suspicious activity. These usually cost a monthly or annual fee, though a company that exposed your data in a breach will often offer it free for a period.
An example
You get a letter saying your details were part of a data breach and the company is offering a year of credit monitoring. That is a credit protection program. It tells you after something suspicious appears on your file. A freeze is different: it stops a thief from opening the account in the first place.
What it does not cover
A freeze does not stop charges on accounts you already have, so you still need to read your statements. None of these tools remove your address, phone number or other details from people-search sites, which is where scammers often get what they need to try to pass as you.
How to protect yourself
- 1
Freeze your credit with all three bureaus
It is free and blocks new accounts opened in your name. Lift it temporarily when you apply for credit yourself.
- 2
Use a fraud alert if you are not ready to freeze
One bureau passes it to the other two, and businesses must verify who you are before opening credit.
- 3
Compare paid monitoring before you buy
Check the fee, what it watches (one bureau or all three) and whether a free offer after a breach already covers you.
- 4
Review your statements and credit reports
A freeze does not stop misuse of existing accounts, so check them regularly.
- 5
Shrink what thieves can find
Serus finds where your address and phone number are listed and removes them, which makes it harder to impersonate you.
See where your personal data is exposed
Serus finds it on data brokers and people-search sites and removes it.
Frequently asked
Is a credit protection program worth paying for?
The FTC notes that a credit freeze is free and blocks new accounts. Paid monitoring only alerts you after activity shows up, so compare what it adds before paying.
Does credit protection stop identity theft?
Not entirely. A freeze stops new credit accounts, but it does not stop charges on existing accounts or other kinds of misuse of your details.
How long does a fraud alert last?
An initial fraud alert lasts one year and can be renewed.
Sources
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