Amid Rising Cyber Security Threats, Know How Cyber Insurance Can Protect You
Technological advancements and cyberattacks are two sides of the same coin. Where the former is bridging gaps and tying the globe together by opening numerous avenues, the latter is exposing users to the darker side of the web in the form of cyber-attacks. For those who are not aware of its meaning, it refers to attempts to obtain unlawful access to a computer, device, or server to cause harm. Although the crime has been around for three decades, its forms have evolved over time- malware-based attacks, password and phishing attacks, crypto-jacking, and the looming future threats involving artificial intelligence (AI), machine learning, and smart hacking devices.
Therefore, with the extended use of technology to connect in this interconnected world and growing online security attacks, it became crucial to guard yourself with a cyber insurance plan. So, here is how cyber insurance can protect you.
What is Cyber Insurance?
Net banking, sharing essential documents, storing credit cards online and participating in virtual meetings and classes are some of the things that are a regular part of our lives. On one end, they may seem routine; on the other, these activities make us vulnerable to cyber-attacks and fraud. Thus, to safeguard yourself in the online world, it has become paramount to buy a cyber insurance plan, which is increasingly gaining popularity and is cited as the fastest-growing insurance segment in India, according to experts. Furthermore, this new-age policy is specifically designed to protect businesses and individuals against the financial implications caused due to internet-based risks involving personal and financial data, such as online hacks, intellectual property losses, privacy breaches, security breaches, etc. Some expenses covered include incurred for damages, recovery after theft or loss of information, investigations, forensic costs, indemnification for lawsuits, extortion payments, etc.
Why is it Essential?
India, like many countries, is constantly on the radar of cybercriminals. According to Indian Computer Emergency Response Team (CERT-in), the reported and tracked attacks until November last year were over 12.5 lakhs. This massive number makes a cyber insurance policy critical to protect oneself and their business against monetary losses as well as to provide mental peace.
Types of Cyber Insurance Coverage
•The First-Party Cover: This policy protects a firm against expenses incurred when they are in the midst of fraudulent activities like a data breach or hack.
•Third-Party Cover: This plan provides security to clients, vendors, partners, etc., in cases where a third party sues the company for allowing a data infringement to occur.
However, it is recommended to have a comprehensive cyber insurance plan that offers coverage against both cases so as to mitigate the expenses caused by the security lapse.
What is Included?
The inclusions vary by policies, but most insurance plans protect against identity theft, malware attacks, cyberstalking and attacks, social media liability, phishing, data breaches, any third-party privacy violations, etc.
How is the Premium Calculated?
Cyber security insurance may seem necessary for everyone, but there is a meticulous process for businesses to procure it. To qualify insurance companies do a thorough underwriting to rate the risk and provide coverages. For this, they must share documents outlining ongoing security procedures and protocols, which are then evaluated against government standards. After the audit, the insurance company states its eligibility and the premium it will be required to pay. However, there is no one-premium amount, and it varies depending on the industry and the policy limits being bought
To conclude, cyber insurance, though a relatively new policy, is undoubtedly the need of the hour, especially in today's time when most people and organizations spend a considerable amount of time online
Cyber insurance broadly protects the policyholder against various risks and instances that may lead to an unauthorized invasion of the network security, server, or gadgets, but with certain exclusions. Some of these are.
•Property damage is not covered in the policy.
•Physical injury, death, or damage to any tangible object are not covered.
•Dishonest or intentional behavior, as well as any fraudulent act that violates a rule or regulation, are not covered.
•Harms or injuries caused due to negligence or a lack of precautions to guard confidential information, such as credit and debit cards, bank accounts, etc., are also excluded.
•Breach of contracts, trade secrets, trademarks, disputes against registered patents, or intellectual property is all uninsured.
•Ongoing and uninsurable legal cases of the policyholder are also not covered.
To conclude, cyber insurance, though a relatively new policy, is undoubtedly the need of the hour, especially in today's time when most people and organizations spend a considerable amount of time online. Hence, always compare the various policies for features, inclusions, and exclusions available online and correspond them to your requirements. Also, read the fine print, as any overlooks at this time may add stress later.