Cybercrime prevention: Be aware and covered
You may need to exercise a little caution if you also conduct numerous digital transactions, online transactions, online purchases, etc. Cybercrime, or online fraud, is on the rise as the world becomes more digital. During the Coronavirus era, online fraud grew in popularity. More than 14 lakh cybercrime instances were reported in 2021 alone. Can an internet fraud be protected by any insurance policy, one would wonder? So, yeah, it is the solution. Cyber insurance is the name for this kind of coverage. Let’s examine what cyber insurance is and why buying it is crucial.
How does a cyber insurance policy work?
Cyber insurance pays for losses brought on by viral assaults on your computers, tablets, or other tech devices. This kind of insurance provides defence against numerous cyberattacks. Additionally, it aids in lowering the possibility that sensitive and critical financial data would be lost due to theft or improper use.
Cyberinsurance Protection
Two types of coverage are primarily offered by cyber insurance. Third party coverage comes in second, after first party coverage. First party insurance offers defence against data loss due to virus or malware assault, blackmail, computer hardware failure, and hacking. The loss resulting from this kind of fraud is covered by third party coverage, however, if your data is stored with any company or on any other platform and it is compromised.
According to Pankaj Mathpal, MD, Optima Money Managers, cyber risk has significantly escalated recently. Data targeting is always possible. Occasionally, the entire system is compromised, and money is demanded. Many of these kinds of cyber hazards might result in losses that can be covered with the aid of cyber insurance. You should get a cyber insurance policy after evaluating your needs and potential cyber dangers.
What is included?
Cyber insurance provides coverage for financial damage brought on by online fraud. The insurance provider will cover the monetary loss incurred if a third party fraudulently accesses the policyholder’s bank account, credit or debit card, or mobile wallet. Additionally, insurance coverage is offered for phishing, email spoofing, and cyber recovery. In addition to this, the insurance provider will also be responsible for covering the cost of any judicial proceedings in cases involving identity theft and cyberstalking (cyberstalking).
The threat of cybercrime is escalating
The country is seeing a sharp rise in cybercrime. Data from the Indian Computer Emergency Response Team, a government organisation established to address cyber security threats, shows that there were 2,08,456 recorded cybercrimes in India in 2018, 3,94,499 in 2019, 11,58,208 in 2020, and 14,02,809 in 2021.
According to the statistics, the number of these cases has nearly climbed seven times in the last three years.
Summary
With the rise of digital transactions and online activities, the threat of cybercrime has also increased significantly. In 2021 alone, over 14 lakh cybercrime incidents were reported in India. To protect against such risks, cyber insurance has emerged as a crucial solution. Cyber insurance policies cover losses incurred due to cyberattacks, providing defense against various types of cyber threats.
There are two primary types of cyber insurance coverage: first-party coverage and third-party coverage. First-party coverage protects against data loss caused by viruses, malware attacks, computer hardware failures, and hacking. On the other hand, third-party coverage comes into play when data stored with another company or platform is compromised, covering losses resulting from such incidents.
Cyber insurance policies offer coverage for financial damages caused by online fraud. If a third party fraudulently accesses a policyholder’s bank account, credit or debit card, or mobile wallet, the insurance provider will cover the monetary loss. Additionally, coverage is provided for phishing, email spoofing, cyber recovery, and legal proceedings related to identity theft and cyberstalking.
The threat of cybercrime continues to escalate in India, with recorded incidents increasing exponentially over the past few years. Given this alarming trend, it is essential for individuals and businesses to assess their cyber risks and consider investing in cyber insurance to mitigate potential financial losses.
By understanding the working of cyber insurance and recognizing its importance, individuals can safeguard themselves against the rising threat of cybercrime and ensure financial protection in the digital age.
