I've said before that I think identity theft insurance is a waste of money. But a recent study by J.D. Power and Associates shows a growing concern amongst Americans when it comes to identity theft, and they want their home insurance companies to do something about it.

According to the J.D. Power and Associates 2006 Homeowners Insurance Study (see here), over 40 percent of homeowners said they'd like their home insurance company to offer ID theft protection. The study also found that ID theft protection was one of the most common types of protection consumers want from their home insurers, second only to auto insurance. (Sidebar: are there really home insurance companies that don't sell home/auto combo policies? Wow.)

Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates said that consumers increasingly feel compelled to protect themselves from ID theft, especially as breaches of personal information by large corporations and government agents continue to surface.

This makes sense to me...sort of. Obviously, as consumers, we're all checking for secure internet connections and shredding our mail before tossing it out with the garbage. But if home insurers decide to meet the demand of the public (and I imagine many of them will...hello, market share), I'd work up front to make sure that the coverage:

1. Actually helped the victim repair his or her credit standing and clear the victim of any illegal activity that happened under his or her name
2. Was a [much] better deal than what credit card companies currently offer cardholders in the event of ID and/or card theft

Otherwise we're just luring folks into a false sense of security, don't you think?

Of course, I think education, as is per usual, is definitely key when it comes to identity theft and insurance. To that end, I'd encourage everyone to talk to their prospects and clients about ID theft...and hey, you can always direct them to our Insurance Blog to learn more! :)

[Hat tip to the Specialty Insurance Blog for the fodder!]