There are lots of reasons for insurance. One kind of insurance (liability) is to protect you in case you screw up. Other kinds of insurance (e.g., uninsured motorist, fire, etc.) are to protect you in case other people screw up.
Absolutely—AFLAK for identity insurance. The free attach plans are pretty thin, most retail contracts will include their man hours to waste away with the credit card companies and fair Isaac / credit bureaus — but it’s obviously more $ than “free with purchase”
