How Does Cyber Insurance Work?

The most popular adage ‘there are two sides of the same coin’ holds true when it comes to technology. While technology has simplified the lives of many, it has created havoc for the rest. One of the major drawbacks of technology is the growth of cyber-crime in India. Data breach and identity theft have become a common aspect of cyber-crime in India. To ensure the protection of your private information over the internet, cyber security insurance has been introduced.

Before purchasing cyber insurance, one must understand the basics of the policy. Knowing the details of digital insurance will help a policyholder to avoid any confusion in the past. Here’s everything one must know about digital insurance. Take a look below:

What is cyber insurance?

As the name suggests, cyber insurance policy safeguards an individual or business firms from the risks of internet activities or infrastructure. Such threats are usually not protected in a general insurance product. Hence, the losses incurred from the internet risks are covered by cyber liability insurance.

Under the cyber insurance policy, there are two main types of coverage provided to the policyholders. Here’s a closer look at the two broad categories of cyber insurance:

1. First-party coverage

It provides coverage against losses like data destruction, extortion, theft, hacking, and denial of service attacks.

2. Third-party (liability) coverage

It indemnifies companies or organisations for losses caused by others. For instance, damage due to errors and omissions, failure to safeguard data, defamation, and so on.

Apart from cyber protection, there are a plethora of other reasons why every individual or an enterprise must buy cyber insurance. Here’s a closer look at the few reasons why a cyber insurance plan is essential for everyone:

Reasons to buy cybersecurity insurance:

1. Data breaches are expensive.
2. The rate of cybercrime is higher
3. Covers for loss of business profits
4. It ensures risk management of the company

Applying for cyber coverage is an easy process. Go through the following steps mentioned below to apply for cyber insurance:

How to apply for cyber insurance?

1. Choose your coverage
2. Fill the relevant details in the application form
3. Opt for an online payment via debit or credit cards, NEFT, and so forth
4. Issue the policy online

To sum up, cyber insurance is an evolving insurance product, which assures the continuity of your business in the long run. However, the coverage provided by insurance companies depends on the severity of the cybercrime. Bajaj Allianz cyber insurance available on Finserv MARKETS considers the new-age risk factors and provides the coverage accordingly. Moreover, cyber insurance on Finserv MARKETS issues extensive coverage at an affordable rate.

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