No payout for online fraud loss

ONLINE banking customers who take out cyber- crime insurance may not be covered for some of the most common types of fraud.

Saga, the over-50s company, has launched personal cybercrime insurance as an add-on to its home contents policies.

Hiscox, another insurer, also offers cyber-crime protection as an extra for home cover, while UK General offers a standalone product.

However, insurers may still refuse to pay out over common online frauds.

Saga’s policy, for example, only covers the cost of legal expenses relating to cybercrime, but would not pay out for money stolen.

Hiscox and UK General both cover losses to customers who have been manipulated into transferring money. But Hiscox says the victim must have taken reasonable steps to verify the person’s identity before making a payment.

And UK General will not cover losses from ‘advance fee fraud’ — where victims are tricked into making an upfront payment for a purchase that never shows up.