For Agents & Brokers
Online or in the mail, taxpayers worry about fraud and ID theft
Cyber thieves target returns and refunds with phishing schemes
HSB's new cyber survey shows that more than two-thirds of consumers are concerned about tax fraud and identity theft this tax season. And they may have reason to worry. The risks of ID theft and fraud increase for the millions of Americans who rush to file near the annual deadline in April.
22 percent have had their identity stolen
The national poll conducted for HSB showed that 67 percent of those responding were concerned about tax-related fraud and 22 percent said they have had their identity stolen in the past. The IRS, meanwhile, warns of a sharp spike in phishing and malware schemes that will continue to pose a risk as individuals wait for tax refunds and spend their windfall.
Tax fraud is a serious problem
"Tax fraud is a leading cause of the identity theft insurance claims that we receive," said Eric Cernak, U.S. cyber and privacy risk practice leader for Munich Re. "As more consumers file their taxes online, they should update security protections on computers, Wi-Fi networks and connected devices."
Most taxpayers file online
The survey found that more taxpayers (37 percent) file and share their tax information online or through a mobile app than deliver their tax information in person (32 percent).
A cyber generation gap
Consumer concerns about tax fraud and identity theft increase with age. Baby Boomers (respondents 53-71) worried the most, with 77 percent expressing concerns; followed by Gen Xers (age 37-51) at 67 percent and Millennials (age 18-36) at 55 percent.
All ages are at risk of fraud
GenXers were actually most likely to be the victims of identity theft (30 percent from that age group reported their identity had been stolen). Twenty-three percent of Baby Boomers said they have had their identity stolen and 18 percent of Millennials.
Six tips to protect your tax information
Here are some tips for individuals when sharing and filing their tax information:
- Keep home operating systems current with the latest security.
- Double-check the security of you home computer network.
- File online from your home or a secure network — don't use public Wi-Fi.
- Closely monitor financial documents.
- Use a secure mailbox — filing inside a post office facility is best.
- Do not automatically provide your Social Security Number.
How employers can protect employees
Employers are also a target because they keep and distribute tax records to employees and vendors. Since employers store and send tax information online and through the mail, they must be extremely careful to secure tax records and other private data.
HSB offers cyber insurance coverage
HSB provides insurance coverage to protect your business clients and consumers from identity theft, data breach and cyber attacks. Click here for more information about HSB coverages available through commercial lines and personal lines agents and brokers.