The amount of personal data being generated, transmitted and stored on various digital devices have grown phenomenally and along with this growth comes the danger of cyber attacks which are rampant now.The Indian Computer Emergency Response Team ( CERT-In) has mentioned a steady rise in the number of cyber crimes reported, ranging from around 44000 in 2014 to around 53000 in 2017.These are based on reported instances and there is every possibility that an equal number remains unreported. Most of these cyber crimes, targeting individuals, are done for getting financial gains illegally.The personal data that are shared with banks and the monies in bank accounts are easily hacked into. As most of our banks follow different software packages, it is difficult to enforce uniform data protection measures.The increased use of smart phones and financial transactions done over mobile applications, only add to the risk element. Some institutions have unscrupulous members who trade personal data for a price, putting the system and the data more vulnerable to a cyber attack.
Types of Cyber Insurance
Senior functionaries in charge of such sensitive data advocate that people go for comprehensivecyber insurancecover, to protect themselves against risks arising out of unauthorized onlinetransactions.Other risks to cover arephishing, identity threat and cyber bullying and other such risks, many of them likely to come up even stronger in the near future.Awareness and the need felt for a cyber insurance is low in India though experts point out an eventual inundation of cyber related risks in India as more financial transactions happen digitally.Insurers are hopeful that the awareness will increase over time and the demand for personal cyber insurance will also increase over the years.Some typical coverage offered by Cyber Insurance are as under:
- Identity theft cover
- Social Media cover
- Cyber stalking cover
- IT theft loss cover,Phishing Cover
- Cyber extortion cover and Cyber bullying.
The cover given under the scheme will keep changing based on demand and increased level of cyber attacks, especially on the financial front.
Need for Cyber Insurance
In a recent report, theGlobal Risk Report of the World Economic Forum,ranked cyber attacks as the single biggest risk to business leaders globally.The annual economic cost of cyber crime the world over is now pegged at around1 trillion dollars,far higher than loss due to a natural calamity like a hurricane which is estimated ataround 300 million USD.The average cost of a cyber breach in India now stands at Rs. 12 crores. The worry for Indian business is the impact on some recent decisions on Aadhar, and the complaints against Google and Facebook, that uphold the fundamental right to privacy. With stringent provisions in the proposed Personal Data Protection Bill 2018 specifying high fines, the need for cyber insurance among corporates has gone up.
Insurance companies that handle claims under the Cyber Insurance point out that human error or employee negligence is the single biggest cause of data breaches followed by hacker attacks. Currently, there are two major types of cyber insurance available to the individual such as Individual Cyber Safe Insurance Policy and Cyber Crime Insurance Policy.other types of Cyber insurance are expected to emerge as hackers move onto more sophisticated methods to defraud individuals as well as corporates.