AI Deepfakes: A Growing Threat to Consumer Identity

AI Deepfakes: A Growing Threat to Consumer Identity

In today's hyper-digital world, cyberattacks have gone from a distant possibility to an unavoidable certainty. And as technology advances, a recent survey from Nationwidereveals that consumers are concerned that those new technologies, particularly Generative AI, will be used to steal their identity.

Generative AI and deepfakes driving consumer fears, especially among older generations
While most consumers are fearful of falling victim to identity theft, they are especially concerned about the misuse of AI for identity theft (86%) - specifically AI-generated deepfakes (73%). AI-related identity theft is a universal worry, but older adults feel more vulnerable to these emerging technological threats.

• 92% of Baby Boomers express anxiety about AI-assisted identity theft.
• Gen X follows closely behind at 86%, while Millennials (81%) and Gen Z (76%) show slightly lower but still significant levels of concern.

Their concerns are valid as 18% report they have been targeted by AI-generated deepfakes or know someone who has, highlighting the evolving and pervasive nature of cybercrime in today's digital landscape.

"It's no surprise that Americans are nervous about Generative AI getting in the hands of criminals looking to steal their identity," says Rachel Bush, Vice President of Technology Business Risk at Nationwide. "As cybercrime continues to evolve and AI-assisted attacks become more sophisticated, it is crucial for consumers to stay informed and take proactive measures to protect themselves."

Cybercrime is hitting closer to home for many U.S. consumers.

• The survey found that 52% of consumers typically encounter threats via spam phone calls, while 47% face threats through personal email.
• 41% of consumers report being affected by identity theft or knowing someone who has.
• 33% have been notified that their personal data was in a company's data breach, within the past 12 months.

Consumer concern is overridden by complacency and misconception, leaving them unprotected and making them easier targets
Despite being highly concerned, 77% of consumers also say they've accepted the risk of identity theft as a normal part of life. This attitude of resignation is leading many consumers to forgo the necessary protection needed to secure their identities.

• Shockingly, 28% admit they have never sought more information about these threats, due in large part to misconceptions about the cost and effectiveness of identity theft coverage, leading to a dangerous gap between awareness and action.
• These misunderstandings run deep:
• 55% think they need a separate policy for each family member.
• 49% are unaware of how much identity theft can damage their credit score.
• 48% believe hiring a lawyer is necessary to recover their identity, even when covered.
• 35% are unaware of the time required for their credit score to recover after an incident.
• 33% do not know how long it takes to recover from identity theft. Only 16% of consumers currently have identity theft insurance.
• Of those without insurance, 43% believe it is too expensive, even though many are willing to spend up to $24 a month-when it actually can cost a fraction of that amount.

"The impacts of identity theft can be far-reaching, from financial loss to reputational damage. That is why it's vital that consumers don't let their guard down when it comes to protecting their digital footprint," says Sarah Jacobs, Nationwide Vice President of Personal Lines Product Development. "Despite proactive efforts, even the most vigilant person can find themselves a victim of cybercrime. This reality underscores the importance of not just preventive measures, but also robust identity protection and recovery plans that provide early detection of suspicious activities, real-time alerts, and continuous monitoring of personal information across the dark web."

With effective coverage available at a low cost (Nationwide ID Theft Protectionis available for as low as $4 a month), Nationwide recommends consumers reach out to their insurance agent to see what options are available to them to take control of their digital lives and protect themselves from the inevitable risks that lie ahead.

Survey methodology:
Nationwide commissioned Edelman Data & Intelligence to conduct a 20-minute quantitative online survey among a sample of 1,000 adult U.S. general consumers between July 26 and August 14, 2024. As a member in good standing with The Insights Association as well as ESOMAR Edelman Data and Intelligence conducts all research in accordance with local, national and international laws as well as in line with all Market Research Standards and Guidelines.