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Perspectives on:
Personal Cyber

What is cybercrime and how are

insurers targeting the growing
personal cyber insurance appetite?


0370 421 4503

UK General Insurance
Cast House
Old Mill Business Park
Gibraltar Island Road
LS10 1RJ
How much of a threat is Cybercrime?
Deirdre Donovan, UK Generals Head of Products looks at how crime is changing and how
UK General look to tackle the growing issue of cybercrime.

Cybercrime is an umbrella term used to describe cyber-dependant crimes
(crimes committed through ICT devices) and cyber-enabled crimes (traditional
crimes increased in scale by the use of computers)1

It’s no secret that cybercrime is on the According to the Office of National Statistics
increase. The threat of attack is rising with (ONS), latest figures reveal there were an
latest figures revealing the substantial estimated 2 million cybercrime attacks
growth of this type of criminal activity. It’s compared to 686,000 domestic burglary
now one of the fastest growing crimes in the offenses in 2016. These figures illustrate the
UK. With an abundance of figures, statistics shift from traditional, domestic crime, to the
and data on cybercrime, a majority of virtual online hacking environment carried
crimes are reported to authorities however, out to breach the security of public and
some still slip through the net. With many consumer cyber safety.
cybercrimes continuing to go unnoticed, are
we only now beginning to scratch the cyber The origins of cybercrime can be traced
security surface? back to 1981 when the first hacker Ian
Murphy, was convicted of breaking into
The term ‘cybercrime’ includes a dangerous AT&T’s computers where he changed
concoction of activities including hacking, the internal clocks that metered billing
computer misuse, viruses and cyber bullying. rates2. This acted as a catalyst, firing ‘The

Computer Misuse Act 1990’ into action. public have double locks on their doors,
Still in use today, the Act criminalises any only 32% follow the latest advice on using
unauthorised access to computer systems. 3 random words to generate a strong
Other examples of historical cybercrimes password3. The Government’s flagship cyber
include ‘The Morris Worm’ in 1998, which awareness campaign Cyber Aware, provides
brought down one-tenth of the internet a wealth of online advice to SME’s and
crippling more than 6000 computer systems. individual consumers encouraging simple
Similarly, in 2000 teenage cyber-hacker steps to prevent cybercrime occurring.
Jonathan James became the first juvenile to
serve jail time for hacking2. An initiative delivered by the home office,
Cyber Aware offers hints and tips to
Although the threat of cybercrime is promote staying safe online and reducing
prominent, it seems Britons are not applying the risk of detrimental cybercrime. Cyber
the same amount of caution as they Aware urges Britons to take cyber security
would do with traditional crimes. Research as seriously as home security with active
conducted by the Office of National partners including ‘ActionFraud’ and ‘Cyber
Statistics (ONS) shows while 82% of the Aware’ helping to spread the message.

Trends in Crime Survey for England and Wales and police recorded crime, year ending
December 1981 to year ending March 2016

Number of offences (thousands)



Police recorded crime - old counting rules
17,000 Police recorded crime - new counting rules

16,000 Police recorded crime - post NGRS

Crime Survey for England and Wales















1981 1983 1985 1987 1989 1991 1993 1995 1997 2000 2002 2004 2006 2008 2010 2012 2014 2016

Year ending December Year ending March

Figures taken from ONS website
Cyberbullying is bullying that takes place using electronic technology including
phones, computers including social media sites, texts and websites9.

Another increasing form of cybercrime is others being bullied online with a further
cyberbullying. According to DitchtheLabel, 42% admitted they have felt unsafe online.
an estimated 1.5 million young people have According to NSPCC over the past 3 years,
experienced cyberbullying within 2015 and there has been an 87% increase in the
19% are bullied daily10. This type of crime number of ChildLine counseling sessions
is a personal attack on an individual often because of online bullying. The statistics
delivered on social media or via direct texts. suggest that cyberbullying is a growing
Popular across the younger generation, a epidemic increasing at an alarming rate and
recent survey conducted by becoming a serious problem for children of
suggested 56% of young people have seen all ages across the UK.

Repeatedly sending messages of threat
and harm, harassment and intimidating
messages threatening a person’s safety.

The act of intentionally leaving someone
out of a group including group messages
and online apps.

Someone who starts arguments or upsets
people, by posting distressing content with
the intention of provoking readers.

The act of sending offensive, rude and
insulting messages to others.

Many think the solution lies with parents In 2014, UK schools incorporated the use of
to protect their children from cyberattacks, bullying ‘slang translation’ software to monitor
however, an education on how to use the their students’ online for bullying behaviour.
internet safely and the procedures to follow Approximately 1,400 schools now use the
if they become a victim of cyberbullying are key software to help teachers identify various issues
to fighting this problem. students may be having online. Surprisingly, it is
not only school children and young people that
In the event of experiencing cyberbullying, are prone to online abuse. There has recently
Stopbullying recommend these three simple been a significant increase in cyberbullying
steps: towards British school teachers. A survey by the
British teachers’ union suggests 60% of their
1. Do not respond and do not forward
members receive some sort of online offensive
cyberbullying messages.
abuse in regards to their profession and of
2. Keep evidence of the cyberbullying. Record these comments, 48% came from pupils and
dates, times and descriptions of each 40% from parents11.
3. Immediately block the person who is cyber
Cybercrime in practice
As the world gets more computer savvy our In a survey ending March 2016, figures
reliance on e-commerce and technology provided by the ONS indicate 6.5% of adults
grows. Technology is becoming more readily in England and Wales had been a victim of
available and our dependence on computers, fraud in the previous sixth months4. With the
tablets and Wi-fi networks is paving a digital vast bulk not reported to police, there has
way of life for modern day living. However, been a 5% rise in frauds during 2016, with 1.9
this technology and instant convenience does million cases of frauds on UK issued cards
not always come without consequence. an 46% increase on the previous year5. These
figures indicate the enormity of cybercrime
both on an individual and collective basis.

Identity Fraud:
Use of stolen identity in criminal activity to obtain goods or services by deception6

Common cybercrime often surrounds Overall, these facts highlight the

fraudulent financial activity. This includes increasing popularity of cybercrime
duplicating bank accounts, falsifying credit towards unassuming consumers within
cards and deceitful online shopping fraud. the mass market. More individuals are
The insurance industry has seen a recent switching to a virtual, online lifestyle
spike in “ghost brokers” selling counterfeit leaving the door wide open for criminals
motor policies. and hackers to access personal details.

Investigations within the industry have According to research carried out by Which?
explored various incidents involving the in 2017, traditional crime is slowly becoming
sales of bogus motor insurance policies to outdated and a new, sophisticated approach
unknowing consumers. During the last 6 of online hacking is occurring across
months of 2016, 2,070 fraudulent policies everyday devices such as wireless routers,
were sold in comparison to only 20 cases home CCTV systems and children’s toys7.
across the same period in the previous year.

Cybercrime – Dissected
The Home Office classify cybercrime into With the increased threat of crime online,
three categories: there are many suggested ways of cyber
• Online scams involving upfront payment protection which are recommended to
• Personal information or data which is stolen keep individuals safe online. Cyber Aware
• A person being tricked into sharing personal recommend using a strong password
information8 consisting of three random words ensuring
they change these words across emails and
In addition, one of the most common types various social media platforms. Users are also
of cybercrime is fraud. The various types range advised to regularly update their software
from identity fraud and theft, to online fraud when prompted to do so. Be vigilant and
and individual fraud. All of which can pose a when visiting websites, ensure they are
serious threat to your online security. genuine by looking for the padlock symbol in
the URL box.

Look out for the padlock symbol in the URL box!

Cybercrime breakdown -
How cybercrime can affect you

Stolen personal Theft of

photographs Cyber bullying personal funds

Hacked social
Online shopping fraud Online sales fraud
media accounts
Cybercrime - Real life attacks:
The scope of cyberattacks on individuals and a victim of fraud. Furthermore, one of the
businesses is vastly impacting everyday life. most recent and most detrimental examples
Research from the government suggests that of a cyberattack was the attack on the NHS
two thirds (65%) of large UK businesses have in May 2017. This breach disrupted national
been hit by a cyber-attack in the past year. health services across England and Scotland
Interestingly, research has suggested that out with 40 NHS organisations corrupted as a
of all firms who have experienced a breach result.
in security, only half of these companies take
any action as a result. Further still, only 10% Latest figures reveal cybercrime is on the rise
have a management plan in place. with criminals conjuring up more complex
and cunning ways to commit this type of
In examining cyberattacks on the general crime. The UK’s leading fraud prevention
public, there is evidence suggesting that service Cifas, have suggested fraud is up
hackers are targeting students in their latest 5% from 2016 with a staggering 89,000
attempt to commit fraud. Cyber Aware cases recorded within the first six months
suggests bogus university grants are being of 2017. Fraudsters are using a mixture
offered to students from their prospective of techniques including misleading Royal
universities. Unassuming victims pass over Mail ‘missed delivery’ cards and fabricated
their bank details to receive the ‘so-called’ council tax rebates to steal personal banking
payments however, later find themselves information.

When criminals use an SMS to trick you into providing your personal or bank

Further examples include Santander customers reveals that everyday gadgets including CCTV
losing over £36,000 in a smishing scam and 5,826 cameras, smart children’s toys and internet routers
reported cases of UK holiday makers loosing £7.2 all carry an increased risk of being hacked offering
million in 2016 booking scams, an average of criminals a gateway into your private information.
£1,200 per person. The holiday booking scams
involved plane tickets, online accommodation
bookings and timeshare sales.

Interestingly with the rise of smart devices in the

average family home, consumers are becoming
more susceptible to the threat of hackers within
their households. Research conducted by Which?

Action against cybercrime:

Police have reported an 8% rise in cybercrime are being stolen at a rate of almost 500
activity overall with 3.6 million cases of fraud per day and more must be done to protect
and 2 million computer misuse offences personal information against cybercrime13.
recorded yearly with the need for urgent Cyber Aware offers advice to consumers
action. As a result, the government is on device and data protection including
investing £1.9bn into cybersecurity over regularly updating software and using
the next 5 years to combat this epidemic. complex passwords.
Shockingly, research suggests that identities

As the transition moves from traditional crime evolving. It is evident that cybercrime will
towards cybercrime, a new type of crime is continue to increase driven by a dependency
evolving. It is evident that cybercrime will on technology in today’s society. Laptops,
continue to increase driven by a dependency tablets and smartphones all provide a
on technology in today’s society. Laptops, platform for criminal activity making it
tablets and smartphones all provide a platform easier for criminals to obtain your personal
for criminal activity making it easier for information. For the majority, the need for
criminals to obtain your personal information. cyber insurance is becoming more of a
For the majority, the need for cyber insurance necessity than an optional extra. UK General
is becoming more of a necessity than an Insurance has identified the consumer need
optional extra, offering protection against of personal cyber insurance and developed
fraud, identity theft and even cyberbullying. a product to answer demand. Our personal
To many, the aspects of cybercrime appear cyber protection insurance offers cover against
complicated and complex making people cyber bullying and defamation, financial loss
an easy target. Overall, the cybercrime associated with recovering insured data,
market is thriving due to an unknowingly but online sales fraud, online shopping fraud and
technology-rich population, unaware of the online theft of personal funds.
threats that are present online. For more information on this product,
As the transition moves from traditional crime contact or
towards cybercrime, a new type of crime is call 0370 421 4503

Head of