08:11 AM CDT on Tuesday, May 30, 2006

By CYNTHIA VEGA / WFAA-TV

An estimated nine million Americans will become victims of identity theft this year—the nation's fastest-growing consumer crime.

With all the publicity surrounding it, many Americans are considering identity theft insurance to protect themselves from potentially disastrous consequences, including a reduced credit rating.

Insurance will certainly buy peace of mind, but is it really worth the cost?

Identity theft insurance typically costs about $600 a year as an add-on to your homeowners' insurance policy.

But security experts urge consumers to use caution before making such an investment. The reason?

Insurance can create a false sense of security and actually increase your chances of becoming a victim.

If you are victimized, chances are your credit card companies, banks and brokers already protect you for free from direct losses due to identity theft, although it is up to the victim to contact those agencies.

"After all the trouble of writing all the letters, do you still want to fill out the claims and certified letters?" asked SMU senior director of technology Allen Gwinn. "I don't know."

Here are some tips on how to avoid becoming a victim of identity theft:

• Guard your personal information
• Shred all documents containing account and other personal information
• Check your bank and credit card statements monthly
• Get a free copy of your credit report

E-mail cvega@wfaa.com