New product will provide cover for online fraud, hacking, defamation and cyber bullying, and is expected to be expanded to cover new risks as the Internet of Things continues to expand
UK General has launched cyber insurance for the personal lines market in response to the growing threat of cyber crime for individuals.
UK General’s chief commercial officer, Matthew Schofield, said: “Our cyber product is a first in the personal lines market offering protection against certain forms of cybercrime affecting ordinary people everyday.
“Cyber is the fastest growing crime in the UK, and there is a need for cover on a personal level because of the losses individuals can face.”
A growing threat
Smartphones and social media have caused a significant rise in cyberbullying, with a recent survey carried out by ditchthelabel.com finding that 41% of 12-20 year olds had had rumours posted about them online and 68% had been sent a nasty private message. The NSPCC says 1.26 million children experience cyberbullying on a daily basis.
The rise in virtual crime has also seen impersonation and deception scams peak, with fraudulent activity in 2016 resulting in financial losses of £432.3m in the UK alone. In 2011 this value was approximately half at £220.9m.
Schofield said that the increasing sophistication of such scams means that people are more likely to fall foul of the fraudsters, and warned people that in many cases they will not be covered by their bank’s policies in the even of incurring a financial loss.
“Lots of people will think they are covered elsewhere, but they are not,” he said. “The increasing sophistication of these scams means that it is getting easier for people to be tricked into giving their card details away, and in those situations it is not straightforward to sort out [and it is likely that you will not be covered by your bank].”
UK General’s cover will provide financial redress in the event of a financial loss resulting from a cyber attack, as well as the removal of any online comments that constitute cyberbullying or defamation.
Tim Marshall, lead underwriter for Munich Re, which is acting as the capacity provider for the product, said: “Insurance for cyber has focused on the corporate sector and high net worth individuals, but we believe it is important for ordinary people to be able to benefit from this form of protection.
“Cyber bullying and other crimes such as fraud respects no boundaries, and many thousands of ordinary people have been affected by fraudsters, criminals and bullies.”
Schofield added that the changing nature of cyber threats means that there will be opportunities to expand the cover provided by this new policy in the future: “As there continues to be more and more devices connected to the internet, there are more opportunities for those devices to be hacked.
“This means that there will be more demand for products such as these.”