All security settings are enabled, but still able to access all iPhone info through usb.

I have an iPhone 5 running iOS 7 with all security settings enabled:

- Passcode enabled (alphanum)

- Erase data enabled

- Require passcode set to immediately

But if someone plug my iPhone into an USB port, and run the software "iTools", he will have access to all information stored in my phone, including any photo and contacts.

This kind of sensitive data shouldn't be encrypted when these settings are enabled?

What about all the info we can find on the interenet, saying that iPhone has a layer of security that defys even law enforcement, but I can´t trust to save my contacts info on it because anyone can read this info if I lose the phone.